All IBT Local 456 Members

RE: Investigation of Embezzlement at the Local 456 Health Fund

As the Trustee appointed by IBT General President Hoffa to protect the democratic rights of Local 456 members and protect your contract standards and benefits, I want to report to you on our recent discovery of an embezzlement scheme at the Local 456 Health Fund.

As a working member of Local 456, you look to your union to protect your rights on the job as well as the benefits you and your family depend on every day - from medical care, to prescription drugs, to pensions. It is a sad day when I have to report to the members that someone who was hired to protect your benefits was actually using their position to steal from you and your benefit fund. But this is the case with the Administrator of the Local 456 Health and Welfare Fund, hired during the previous Administration.

This is just the latest in a pattern of corruption that we have discovered since general

President Hoffa appointed me as your Trustee.

As you may already know, your pension fund is still trying to recoup over three million dollars that were embezzled more than two years ago. And soon after I was appointed a Trustee of the Local 456 benefit funds, we discovered that many retirees were not receiving their correct pension. As a result of these two events, I asked for a complete audit of the health and pension funds to ensure that they were operating for the exclusive benefit of Local 456 members and not being corrupted and weakened.

Immediately after our investigations began, I was criticized by a small group of vocal members connected to the previous Administration for spending Local resources to conduct an investigation. These same members also began calling for an end to the Trusteeship. As this campaign developed, the Trustee and his staff were subject to threatening phone calls, tires were slashed in the Local 456 parking lot, and the Local 456 offices were robbed. It is not a coincidence that this campaign of intimidation began as we were starting to uncover problems at the Fund.

I regret to inform you that because we were not intimidated into ending our investigation we have been able to uncover a pattern of corruption that has depleted the health care fund that is there to protect you and your family. A long time employee, the Administrator of the health fund, has admitted in a sworn deposition to embezzling from your health funds. The employee has been terminated and I have asked the Fund trustees to authorize a full audit of the health fund.

There are still many questions as to how this happened without being detected by the Fund Trustees, including the previous leadership of Local 456, or by the Fund's accountant. But I assure you that we will get to the bottom of it and will not stop until the stolen funds are returned and we have implemented safeguards to ensure your health fund is free of corruption.

General President Hoffa appointed me as Trustee of Local 456 to protect your interests and benefits. All of you work hard to earn the money that is contributed to the Fund by your employers. It is ironic that during the Trusteeship hearing last year, members were told by the same group that is behind the problems I described earlier that the Trusteeship would undermine your contract protections and benefits. As this case and others have shown, nothing could be further from the truth.

Under the Trusteeship, we have protected the Local 456 hiring hall, maintained and strengthened your contracts, and enhanced your health and dental benefits. We have answered member questions and expanded the monitoring of worksites by Local 456 business agents.

As I told the members during the Trusteeship hearing, no one would like the Trusteeship to end sooner than me. But I will also not give up until the last seed of corruption in Local 456 is eliminated. The longer those who would attempt to intimidate the Trustee and the Local 456 staff continue, the more difficult it will be to achieve that objective. When I am satisfied that we have reached the point where Local 456 can run on its own, free of corruption and intimidation, I will proudly recommend the end of the Trusteeship and a return of Local 456 to its members.