ANN ARBOR -- Corrupted by power and the ability to influence the spending of large amounts of UAW cash, Jeffrey Pietrzyk succumbed to greed, federal prosecutors alleged.

He accepted more than $123,000 in kickbacks and bribes, and attempted to hide his financial misdeeds, the U.S. Attorney’s Office said in a federal court filing charging Pietrzyk with conspiracy to commit wire fraud and laundering of money instruments.

“I am guilty,” Pietrzyk told presiding U.S. District Judge Bernard A. Friedman in an Ann Arbor courtroom on Tuesday, Oct. 22.

Pietrzyk, 74, who is now retired and lives in Grand Island, New York, pleaded guilty to both counts. According to the terms of a plea deal with the U.S. Attorney’s Office, Pietrzyk is expected to be sentenced to at two years in prison and must repay $123,000 to the federal government.

“I apologize,” said Pietrzyk as he walked out of the Ann Arbor federal courthouse flanked by his Buffalo, New York-based attorney, Robert Singer.

Singer said his client’s role in the corruption was “much less” than others, but he acknowledged Pietrzyk’s actions were “a violation of law.”

“Besides conspiring with other UAW officials and vendors to the UAW, Pietrzyk also admitted that he conspired to launder the proceeds of the kickback scheme by using various methods to conceal and disguise the bribes and kickbacks through a lengthy and complicated series of financial transactions,” the U.S. Attorney’s Office announced in a statement following Pietrzyk’s plea.

He is expected to be sentenced March 3 in Detroit.

Pietrzyk’s crimes were part of a larger conspiracy involving multiple auto union officials who worked with the UAW-GM Center for Human Resources, a tax-exempt entity infused with GM cash and intended to elevate and train members.

Between 2010 and 2014, Pietrzyk was the co-director of the Center for Human Resources and served as a board member. The fraud scheme began in 2006 and continued until July 2018, federal prosecutors allege.

The scheme involved setting up deals for selected companies who reaped lucrative contracts and compensated Pietrzyk and others, federal prosecutors claim. Also accused is Michael Grimes, a former UAW executive who worked for General Motors. He pleaded guilty to corruption in September and is scheduled to be sentenced Jan. 14. An agreement he reached with the U.S. Attorney’s Office calls for him to spend nearly four years in prison.

Multiple UAW officials have also been indicted on similar fraud charges related to the handling of union training funds at Fiat Chrysler.

The corruption probe targeting fraudulent UAW union dealings involving both automakers resulted in 10 convictions, with sentences ranging from 60 days in jail to more than five years in prison, according to the U.S. Attorney’s office.

Ann Arbor federal court, Oct. 22, 2019.

Some of the accusations in Pietrzyk’s case:

The watches

A watch company that remains unnamed in court filings first received a contract with the training center to sell 23,000 watches to the GM powertrain divisions. Grimes is accused of demanding the company provide a $60,000 mortgage in order for him to purchase a property in Rose Township. After initially declining, Grimes threatened the cancellation of the watch contract and the company conceded.

The company provided a $60,000 contract and then agreed to pay Grimes a $60,000 lump sum for a “consulting agreement.” It didn’t end there. The government claims Grimes demanded a monthly payment of $1,800 that eventually grew to $3,800. The payments were disguised as payments to relatives of Grimes or a “sham” consulting company he created, the government said.

From November 2010 until October 2017, the U.S. Attorney’s Office identified nearly $900,000 in kickbacks paid to Grimes by the watch company.

The watch company continued providing watches to the Center for Human Resources and GM facilities. throughout the life of the scheme, Pietrzyk.

'Team UAW-GM’

A union official accused of conspiring with Grimes and Pietrzyk proposed the training center purchase 50,000 “Team UAW-GM” jackets in 2011, a contract worth nearly $6 million, according to prosecutors’ allegations. It went to the watch company where Grimes was already on the payroll, the U.S. Attorney’s Office claims.

With Grimes acting as the mouthpiece and Pietrzyk as a middleman, the company that received the contract was asked to pay $300,000 in kickbacks to the union officials who initiated the contract.

The U.S. Attorney’s Office filing indicates Grimes also leveraged the company to pay him a $530,000 kickback that Grimes used to pay off property he owned in Fenton.

Backpacks

In 2016, the same company received a $5.8 million contract to provide 55,000 backpacks to UAW members. Grimes is accused of soliciting a $1 million kickback, but when the company refused, he settled for $500,000, according to court filings.

More watches

A union official who remains unnamed in the charging documents filed against Pietrzyk convinced a vendor in 2012 to make a $250,000 construction loan to “an associate," the Pietrzyk filing says.

The recipient of the loan stopped making payments, leading the union official to propose another possibility for recouping the loan losses. The union official set up the company to bid on a $4 million contract to provide 58,000 watches to the UAW at cost of $68.50 per watch.

The union official and Pietrzyk, who sat on the Center for Human Resources Board, helped ensure the contract was approved.

The new watch provider then began issuing kickbacks in the form of checks, sometimes writing “antique furniture” in the memo field, the government says. The company paid kickbacks to the unnamed union official in the amount of $30,000. Pietrzyk received $70,000 and Grimes received $25,000, the government filing alleges.

The watches were delivered to the Center for Human Resources on Jan. 31, 2014, but were never delivered and are currently being stored in a warehouse, the government claims.

Information filing against Pietrzyk: