Fiat Chrysler Ordered To Pay $30M In Corruption Scandal: Feds

DETROIT — A Fiat Chrysler Automobiles representative on Monday pleaded guilty to conspiring to violate the Labor Management Relations Act on behalf of the company, admitting to making illegal payments to officers of the United Auto Workers union that was used to fund lavish parties, pay off mortgages and even an Italian-made shotgun, federal law enforcement officials said.

In a virtual court hearing before U.S. District Judge Paul Borman Monday, the representative admitted that the company had conspired with others to violate the Taft-Hartley Act by making more than $3.5 million in illegal payments to officers of the International Union, United Automobile, Aerospace, and Agricultural Implement Workers of America between 2009 through 2016.

In exchange for the plea, the FCA agreed to pay a fine of $30 million. In addition, FCA has agreed to be subject to probation for three years.

“Through its participation in this conspiracy, FCA violated federal labor law and undermined the collective bargaining process and the faith of the UAW’s membership in their leaders," Acting U.S. Attorney Saima Mohsin said. "By seeking a $30 million fine and three years of oversight by a court-appointed monitor, we are holding FCA accountable and sending a message to other companies that these types of crimes will not be tolerated.”

FCA executives — including Alphons Iacobelli, Jerome Durden and others — engineered the illegal payments to senior officials of the UAW, authorities said. Iacobelli was the Senior Vice President of FCA US LLC in charge of labor relations from 2009 to June 2015.

The payments to UAW officials took various forms, authorities said, including meals, rounds of golf, parties for the UAW International Executive Board, an Italian-made shotgun, clothing, designer shoes and other personal items paid for with credit cards issued by the joint training center.

FCA executives also paid off the $262,000 home mortgage of former UAW Vice President General Holiefield, authorities said. Holiefield and his widow also received hundreds of thousands of dollars directed through Holiefield’s purported charitable organization, as well as companies controlled by him that had contracts with the training center, officials said.

The UAW officials who accepted illegal payments included former UAW Vice Presidents Holiefield and Norwood Jewell, Holiefield’s widow, Monica Morgan, and senior UAW officials, Virdell King, Keith Mickens and Nancy Johnson.

Morgan and all of the UAW officials, except for Holiefield, have pleaded guilty to conspiring to accept the illegal payments from FCA or tax charges, officials said. Holiefield died in 2014.

Fifteen people have been convicted of federal crimes amid the feds' investigation into illegal payments by FCA to UAW officials and embezzlement by other UAW officers, including three former FCA executives.