11 Union Officials Charged With Racketeering, Fraud, And Bribery Offenses | USAO-SDNY

Ilan Graff, Attorney for the United States, Acting Under Authority Conferred by 28 U.S.C. § 515, and Timothy D. Sini, Suffolk County District Attorney, announced today the return of an indictment charging JAMES CAHILL, CHRISTOPHER KRAFT, PATRICK HILL, MATTHEW NORTON, WILLIAM BRIAN WANGERMAN, KEVIN MCCARRON, JEREMY SHEERAN, a/k/a “Max,” ANDREW MCKEON, and ROBERT EGAN with racketeering, fraud, and bribery offenses, in connection with their acceptance of payments in their roles as current and former union officials to corruptly influence labor-management relations in the construction industry.  SCOTT ROCHE and ARTHUR GIPSON are charged with fraud and bribery offenses.  The defendants are current and former union officials with Local 638 of the Enterprise Association of Steamfitters (“Local 638”) and Local Union 200 of the United Association of Journeyman and Apprentices of the Plumbing and Pipe Fitting Industry of the United States and Canada (“Local 200”).  CAHILL is the president of the New York State Building and Construction Trades Council (the “NYS Trades Council”), which represents over 200,000 unionized construction workers, and a member of the executive council for the New York State American Federation of Labor and Congress of Industrial Organizations (the “NYS AFL-CIO”).  As alleged, since in or around October 2018, the defendants agreed to accept dozens of bribes, totaling over $100,000, in exchange for which they used their authority to corruptly influence the construction industry at the expense of labor unions and their members. 

All of the defendants were arrested yesterday afternoon or earlier today and will be presented this afternoon before United States Magistrate Judge Robert W. Lehrburger.  The case is assigned to Chief United States District Judge Colleen McMahon.

Attorney for the United States Ilan Graff said:  “As alleged, the defendants exploited their labor organization positions to line their own pockets.  They did so at the expense of the unions and their members by accepting bribes to favor non-union employers and corruptly influence the construction trade.  Today’s indictment reflects our commitment to rooting out corruption and bringing to justice those who abuse positions of power out of personal greed.  We thank the Suffolk County District Attorney’s Office for their partnership in this case.”

Suffolk County District Attorney Timothy D. Sini said:  “As alleged in today’s indictment, these union officials – who purported to be the ones looking out for workers and their rights – were in fact engaged in an enterprise of corruption at the expense of the hardworking men and women they claimed to represent. This was a complete betrayal of these unions and their membership. Our two-year wiretap investigation uncovered a shocking level of greed and corruption, and the investigation is very much ongoing. I want to thank the U.S. Attorney’s Office for the Southern District of New York for partnering with my office on this investigation and for working with us to hold these alleged bad actors accountable in federal court.”

According to the allegations in the Indictment[[1]]:

JAMES CAHILL, CHRISTOPHER KRAFT, PATRICK HILL, MATTHEW NORTON, WILLIAM BRIAN WANGERMAN, KEVIN MCCARRON, JEREMY SHEERAN, a/k/a “Max,” ANDREW MCKEON, and ROBERT EGAN, are members of an enterprise (the “Enterprise”) comprising current and former officials of Local 638, a union with jurisdiction over pipe fitting in New York City and Long Island.  The Enterprise was a criminal organization whose members agreed to engage in, among other activities, honest services fraud, receipts of bribes as labor union officials, and unlawful receipt of payments to labor organizations.  Members of the Enterprise conspired to accept cash bribes, as well as bribes in the form of “loans” that were never repaid, free meals and drinks, free labor on personal property, and purchases of home appliances.  Since in or around October 2018, the defendants accepted dozens of bribes, totaling over $100,000.

JAMES CAHILL was the leader of the Enterprise.  In addition to being president of the NYS Trades Council and a member of the NYS AFL-CIO’s executive council, CAHILL is also a former business agent of Local 638, and a former international representative of the United Association of Journeymen and Apprentices of the Plumbing and Pipe Fitting Industry of the United States and Canada.  As the Enterprise’s leader, CAHILL influenced Local 638’s elections and installed loyal associates into official positions within Local 638.  CAHILL initiated several Local 638 officials into the Enterprise so they could accept bribes and expand their influence.  For example, after CAHILL brought defendant PATRICK HILL into the Enterprise as a union official who would – and did – accept bribes, CAHILL told a non-union employer from whom CAHILL and HILL had received bribes (“Employer-1”): “Here’s the thing.  I give you Paddy [HILL].  But if Paddy fucks up and does stupid things, you have to tell me . . . I got my guys, I got the guys who come to me, and you know that, and everyone knows who comes to me.”  CAHILL told HILL, following HILL’s receipt of a bribe from Employer-1, “Welcome to the real world.”  NORTON similarly stated in a meeting at which NORTON, CAHILL, and HILL received bribes:  “The real world is the real world and there’s . . . always wiggle room as long as everyone . . . understands each other, and everyone’s taken care of.”

CAHILL and the other members of the Enterprise used their positions of power with respect to Local 638 to receive bribes in exchange for taking actions favorable to non-union employers, and exercising corrupt influence within the construction trade, all to the detriment of Local 638 and the union members’ interests.  For instance, in one meeting with Employer-1, CAHILL urged Employer-1, in sum and substance, not to sign with a union, but instead to “tell everyone to go fuck themselves” because “if you become union, you’ll have 12 fucking guys on your back.” 

All 11 defendants are also charged with participating in conspiracies to commit honest services fraud and violate the Taft-Hartley Act, based on, among other things, their agreement to accept bribes in exchange for acquiescing in the bidding and performing of construction work with non-union labor for plumbing and pipe fitting projects that would otherwise have potentially been awarded to companies whose employees were represented by Local 638 or Local 200.  

*                *                *

A chart containing the names, charges, and maximum penalties for the defendants is set forth below.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.

Mr. Graff praised the outstanding investigative work of the Special Agents within the U.S. Attorney’s Office for the Southern District of New York and Investigators with the Suffolk County District Attorney’s Office, and noted that the investigation is ongoing.

This case is being handled by the Office’s Violent and Organized Crime Unit.  Assistant U.S. Attorneys Jason Swergold, Danielle Sassoon, and Jun Xiang, and Special Assistant U.S. Attorney Laura de Oliveira, are in charge of the prosecution.

The charges in the Indictment are merely accusations and the defendants are presumed innocent unless and until proven guilty.

Count

Charge

Defendants

Max. Penalty

Count One

Racketeering Conspiracy

18 U.S.C. § 1962(d)

JAMES CAHILL

 

CHRISTOPHER KRAFT

 

PATRICK HILL

 

MATTHEW NORTON

 

WILLIAM BRIAN WANGERMAN

 

KEVIN MCCARRON

 

JEREMY SHEERAN, a/k/a “Max”

 

ANDREW MCKEON

 

ROBERT EGAN

20 years’ imprisonment

Count Two

Honest Services Fraud Conspiracy

 

18 U.S.C. §§ 1343, 1346, and 1349

JAMES CAHILL

 

CHRISTOPHER KRAFT

 

PATRICK HILL

 

MATTHEW NORTON

 

WILLIAM BRIAN WANGERMAN

 

KEVIN MCCARRON

 

JEREMY SHEERAN, a/k/a “Max”

 

ANDREW MCKEON

 

ROBERT EGAN

 

SCOTT ROCHE

 

ARTHUR GIPSON

20 years’ imprisonment

Count Three

Conspiracy to Violate the Taft-Hartley Act

 

18 U.S.C. § 371

JAMES CAHILL

 

CHRISTOPHER KRAFT

 

PATRICK HILL

 

MATTHEW NORTON

 

WILLIAM BRIAN WANGERMAN

 

KEVIN MCCARRON

 

JEREMY SHEERAN, a/k/a “Max”

 

ANDREW MCKEON

 

ROBERT EGAN

 

SCOTT ROCHE

 

ARTHUR GIPSON

5 years’ imprisonment

 

 


[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth herein constitute only allegations and every fact described should be treated as an allegation.

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