01.12.2009

Prosecutor heads NY crane investigation

A federal judge has appointed a former prosecutor, George Stamboulidis, to investigate corruption and mob influence in Local 14-14B of the International Union of Operating Engineers, the union that represents most tower crane operators in New York City.

Stamboulidis, a managing partner at the legal firm of Baker Hosteller, was appointed to the post of “ethical practices attorney” for Local 14-14B last week by Judge Sterling Johnson of United States District Court in Brooklyn. Another lawyer, Steven C. Bennett, has been appointed as a ‘hearing officer’ to adjudicate the actions brought by Stamboulidis.

The appointment follows a consent decree that was signed by the union last year, after the settlement of a civil racketeering lawsuit brought by federal prosecutors that claimed that the Genovese and Colombo families had “exercised corrupt influence within Local 14” for almost 30 years.

The union has admitted to helping unqualified individuals gain crane operator licences without the necessary training and testing procedures.

The government statement at the time claimed that two criminal cases, which led to the conviction of 26 union officials and members and a number of ‘mob figures’, had established that “the crime families wielded sufficient control over the union to secure no-show jobs for mob associates. Union officials and members also received payments for the no-show jobs and bribes from construction contractors to ignore the collective bargaining agreement.”

The consent decree acknowledged that the union had taken some steps to address the corruption, but that additional steps needed to be taken.
The consent decree gives Stamboulidis a mandate to investigate union officials and members and rule on their fitness to hold office, as well as examine its practices and finances, test the skills of union members, commence disciplinary proceedings, and monitor collective bargaining agreements and elections.

The hope is that the appointment will begin to root out what critics claim is decades of corruption in the construction industry, stemming from persistent organised crime infiltration and ingrained labour bribery.

Crane operators in New York City are highly paid and very powerful, given their ability to bring construction on high rise developments to a halt. As a result they have been a key weapon in the Union’s negotiating armoury. Construction companies are virtually obliged to hire union operators and while other unions have made concessions this year in the face of the economic slow down, the operators union has refused to budge.. causing friction with employers and other unions.