Fiat Chrysler exec charged in FCA-UAW scandal

Another Fiat Chrysler executive has been charged in the ongoing UAW-Fiat Chrysler scandal that involves union and automotive officials cheating thousands of autoworkers out of $4.5 million in training funds.

Michael Brown, the former director of employee relations at Fiat Chrysler, is charged with lying to a federal grand jury about an alleged bribery scheme involving his boss and others at FCA.

Specifically, prosecutors allege that Brown knew that FCA officials were bribing UAW leaders, but "deliberately" provided "misleading and incomplete testimony" about the scam. Not only did he know that this was going on, prosecutors allege, but he failed to notify authorities about the corruption.

Brown, who is the second FCA official charged in the case, worked under former FCA Vice President Alphons Iacobelli, a central figure in the case who is accused of raiding $4.5 million from a training center that was supposed to help blue collar workers. Instead, prosecutors say, Iacobelli funneled the training center funds to himself and and UAW officials, buying everything from luxury vehicles to $35,000 Mont Blanc ink pens.

Prosecutors allege the bribes were part of a bigger plot by Fiat Chrysler executives to keep UAW officials "fat, dumb and happy" by giving them credit cards and urging them to go on spending sprees with money that was supposed to train blue collar workers.

Iacobelli pulled this off, prosecutors said, with the help of a Fiat Chrysler financial analyst who cooked the books to hide the fraud. The FCA analyst, Jerome Durden of Rochester Hills, pleaded guilty in the case and faces up to five years in prison when he is sentenced in May.

Iacobelli also has pleaded guilty in the case and faces up to eight years in prison when he is sentenced in May.

The charges against Brown were filed Tuesday in U.S. District Court in what is known as an "information" charging document, which typically means the defendant has a plea deal in the works.

So far, the federal government has charged six individuals for their various roles in the alleged conspiracy.

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They include Keith Mickens, a top labor leader who helped negotiate contracts between the UAW and FCA. He was charged last month with buying designer clothes, luggage and golf equipment with money that was supposed to help train autoworkers.

According to court records, Mickens used a National Training Center credit card to buy more than $1,000 worth of luggage and $6,500 worth of electronics, designer clothing and golf equipment for himself and other UAW officials.

Also charged in the scheme are Monica Morgan, 54, of Harrison Township, the widow of the late UAW Vice President General Holiefield. The government said Morgan and Holiefield both stole from the training center with the help of Iacobelli.

Morgan also pleaded guilty in the case last month, but only to a tax crime, admitting she hid $201,000 from the government on her 2011 taxes, but without explaining where the money came from.

She faces 27 months in prison under her sentencing guidelines. She will be sentenced June 4 and also has to pay $190,747 in restitution to the U.S. Treasury.

According to prosecutors, Morgan's photo business once received $70,000 from a charity that was supposed to help children struggling with hardships. The government claims the charity was really a sham, set up by Holiefield and Iacobelli.

During the scheme, the government says, Holiefield was the director of the UAW Chrysler Department and acted as the lead negotiator and the lead administrator for the collective bargaining agreements between the UAW and FCA. He died in 2015.

According to court documents, the UAW-Chrysler National Training Center was funded by FCA and received between $13 million and $31 million a year. Prosecutors say at least $4.5 million of that money was misspent, and allege that FCA executives were bribing union brass with the intention of giving the company a better position at the bargaining table.

The UAW has stressed that the scheme did not affect negotiations.

In a previous statement, the UAW has said: “The scheme ... did not affect the negotiation of the terms of our collective bargaining agreements or involve the loss of any union funds.”

The sixth defendant charged in the scheme is Retired UAW Associate Director Virdell King, 65, of Detroit, a one-time rising star at the UAW who made a name for herself as a female pioneer in the male-dominated union. King is accused of — among other things — buying designer shoes, clothing, jewelry and luggage using credit cards that were issued through the UAW-Chrysler National Training Center.

She also was accused of making more than $40,000 in additional purchases that pampered other senior UAW officials, including a shotgun, golf equipment, luggage, concert tickets, theme park tickets and other items. King has pleaded guilty to her role in the scheme and will be sentenced in August.

Contact Tresa Baldas: tbaldas@freepress.com. Follow her on Twitter @Tbaldas