Teamsters chief ousted over funds diversion Carey has denied knowledge of scheme

Hamilton also expelled


July 28, 1998|By BOSTON GLOBE

Eighteen months after suspicions surfaced about the 1996 Teamsters election, a federally appointed board yesterday expelled President Ron Carey from the union for an illegal fund-raising scheme that became the deciding factor in his narrow re-election over James P. Hoffa.

Carey has repeatedly denied knowing anything about the scheme that directed $885,000 in union funds to third-party political groups to benefit his campaign in the final frantic days before the election.

But in yesterday's ruling, the Independent Review Board found that Carey was responsible for the plot. The board also expelled the union's political director, William Hamilton, and in a scathing 35-page report said, "The serious breaches of trust by Hamilton and Carey require severe sanctions."

The ruling is a blow to supporters of Carey, who during 30 years as a Teamsters officer gained a reputation for cleaning up the notoriously corrupt union. Hoffa supporters, meanwhile, rejoiced and seized the moment as a political opportunity.

"Today's Independent Review Board decision banning Ron Carey from the Teamsters for life is a small step toward returning honest, competent and, above all, democratically elected leadership to the Teamsters," Hoffa said in a statement shortly after the ruling.

"The IRB's decision drives a stake through the heart of the myth peddled by Carey sympathizers inside and outside the Teamsters."

Hoffa, who is again running for the presidency in the coming September election, said a "free and fair" election should be held "immediately."

Evidence of a campaign scheme surfaced just weeks after the December 1996 election, in which Carey and Hoffaran brutal neck-and-neck campaigns. Carey won unexpectedly by a narrow margin, prompting Hoffa supporters to demand a recount and investigate the possibility of fraud.

John Murphy, secretary treasurer of Teamsters Local 122 in Boston and a Hoffa supporter, said he discovered suspicious documents in Carey's campaign financial disclosures.

The discovery led to federal investigations, including an FBI probe into allegations that union money was illegally funneled through groups including Citizen Action and Project Vote to finance Carey's campaign.

Under the rules of federally supervised elections, Teamsters union officials are barred from accepting campaign contributions from any employers, whether or not they employ Teamsters, and from using union money to finance their elections.

The investigation netted a number of Carey supporters, including consultant Michael Ansara, of Somerville, Mass., who was chief executive of Share Group Inc., a telemarketing company.

He pleaded guilty last year to conspiracy charges and agreed to cooperate with federal investigators.

Carey's former campaign manager and another consultant, Martin Davis, also pleaded guilty to federal charges stemming from the scheme, and political director Hamilton was indicted by a federal grand jury in New York.

Until yesterday, Carey had been largely unmarked by the investigations and had maintained that the scheme was the unsolicited work of staffers and political consultants.

"This is the end of a long, arduous march," Murphy said of yesterday's decision. "What this did today is confirm what I have long believed. It's time now for all Teamsters to put this behind them. The people who supported Carey, I know, feel betrayed and disappointed. In general, I think the whole scandal has been very demoralizing. All of organized labor has been hurt. It will take a few years to recover from this."

Pub Date: 7/28/98

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