Another shoe dropped on the growing UAW-Chrysler scandal.  Recently, Alphons Iacobelli, the former Chrysler VP of Labor Relations, was sentenced to 5½ years in federal prison for siphoning money from the joint UAW-FCA training center.  Mr. Iacobelli purchased a $350,000 Ferrari, $35,000 Mont Blanc pens, and built a pool in his backyard with money from the training center.  He also provided funds and gifts to UAW officials.

Mr. Iacobelli’s sentence follows the 18-month sentence of a former UAW official and wife of a deceased UAW VP who was responsible for negotiation with Chrysler.  Monica Morgan-Holiefield and her departed husband, General Holiefield, paid off their home mortgage and went on extravagant trips with funds from the UAW-Chrysler joint training center.

Thus far, four UAW officials and three Chrysler employees have been indicted.  The UAW and Chrysler’s stance has been the same:  these unlawful payments did not influence collective bargaining negotiations between the two.

But, the federal government sees it differently. The federal prosecutors are alleging that over $9 million from the training center were used to influence negotiations.  In the government’s sentencing memorandum filed with the court, the prosecutors stated, “FCA sought to obtain benefits, concessions and advantages in the negotiation and administration of collective bargaining agreements with the UAW in an effort to buy labor peace.  High-level officials of the UAW sought to enrich themselves and live lavish lifestyles rather than zealously work on behalf of the best interests of tens of thousands of rank and file members of their union.”

If the government’s allegations turn out to be true, then the government could move to oversee the UAW’s finances, just like it did with the Teamsters for over a decade.