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    Aug022012

    Wall Street Journal: Ex-Leader Union Leader Is Charged With Fraud

    By Kris Maher, Wall Street Journal

    A former rising star within the Service Employees International Union has been charged with bilking his ex-employer, one of the nation’s most powerful labor groups.

    Tyrone Freeman, 42 years old, who once led a large Los Angeles-based local representing low-wage health-care workers, was indicted Tuesday on 15 criminal counts, including mail fraud and the embezzlement of $100,000.

    Mr. Freeman is accused of diverting union funds in $2,500 monthly payments in 2007 and 2008. The federal grand jury that indicted Mr. Freeman late Tuesday said he also improperly took $17,000 from a low-income-housing nonprofit group and used a union credit card to pay $8,000 toward his Hawaii wedding.

    The charges cap a four-year probe by the Labor Department, the Federal Bureau of Investigation and the Internal Revenue Service. Mr. Freeman, who now lives in Pittsburgh and has recently worked as a business consultant, faces a maximum sentence of more than 200 years in prison if convicted on all counts.

    His attorney, Michael Zweiback, said Mr. Freeman is innocent of all charges and will plead not guilty at an arraignment scheduled for Sept. 24 in federal district court in Los Angeles. “When the truth comes out at trial, it will be abundantly clear that he acted appropriately at all times,” Mr. Zweiback said.

    Abel Salinas, the Labor Department’s special agent in charge of the Los Angeles regional office, said the indictment demonstrates the federal government’s “commitment to investigating allegations of labor racketeering in our nation’s unions.”

    In June, Mr. Freeman’s wife, Pilar Planells, pleaded guilty to a misdemeanor count of failure to file a 2008 tax return in connection with more than $540,000 in consulting fees her video production company earned that year from the local her husband led.

    Mr. Freeman was chief of SEIU Local 6434, known as United Long Term Care Workers, or ULTCW, which now represents 180,000 workers who provide health care to the elderly and disabled in nursing homes and private residences. He had been appointed to the post by former SEIU President Andy Stern, who retired in 2010.

    “The members of SEIU ULTCW are pleased that justice is being served,” Mr. Freeman’s former local said.

    The SEIU dismissed Mr. Freeman in 2008 and barred him for life from the union. In 2009, the SEIU sued him in Los Angeles Superior Court, seeking to recover more than $1.1 million in union funds it said he misspent. The funds allegedly include $13,000 paid to the Grand Havana Room in Beverly Hills for $175 glasses of cognac, among other expenses.

    Thom Mrozek, a spokesman for the U.S. attorney’s office in Los Angeles, declined to comment on whether any other SEIU officials could be charged, citing a continuing investigation.

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