LAWFUEL- The Legal Newswire – MICHAEL J. GARCIA, the United States Attorney for the Southern District of New York, announced that FRANK PROSCIA — a former shop steward and Executive Delegate of Local 157 of the United Brotherhood of Carpenters and Joiners (the “Carpenters
Union”) — pleaded guilty today before United States District
Judge BARBARA S. JONES to one count of aiding and abetting the
embezzlement of monies from employee benefit plans. According to
the Indictment filed in Manhattan federal court and statements
made during PROSCIA’s guilty plea proceedings:
From February through June 2006, PROSCIA conspired with
co-defendant MICHAEL ANNUCCI (also a former shop steward) and
others to defraud the District Council of New York City and
Vicinity (the “District Council”) — the administrative body that
oversees the New York City local chapters of the Carpenters Union
— and the union benefit funds. Among other things, the
defendants submitted false shop steward reports that
underreported the number of carpenters and the hours worked by
carpenters for a construction contractor at a jobsite located in
New York City.
L&D Installers, Inc. (“L&D”) was a furniture
installation and construction contractor that operated in New
York City and the vicinity. L&D was a party to a collective
bargaining agreement with the District Council. Pursuant to the
agreement, L&D was obligated to pay all of its workers at an
hourly rate specified in that agreement and to make contributions
for each hour worked to the District Council Benefit Funds. The
District Council Benefit Funds, which are covered by the laws
governing Employee Retirement Income Security Act (“ERISA”)
plans, provide life insurance, hospitalization, medical care,
pension and vacation benefits to union members.
A shop steward’s principal duty is to be the daily
“eyes and ears” of the union and to report a contractor’s
violations of the collective bargaining agreement (“CBA”). The
shop steward is required to submit weekly reports, called “shop
steward reports,” to the union office, setting forth the hours
worked by each of the union’s members assigned to the jobsite.
Thus, the shop steward is required to observe the number of hours
worked at the jobsite by the union members in order to report the
carpenter-hours accurately each week. Underreporting of hours
worked by union carpenters saves the contractor money and shortchanges
union workers.
FRANK PROSCIA knowingly submitted false shop steward
reports to Local 157 offices which underreported the number of
carpenters and hours worked at the L&D job site at 11 Madison
Avenue in Manhattan, where PROSCIA was serving as shop steward,
in order to help L&D evade its obligation to make contributions
to the District Council Benefit Funds. PROSCIA entered a guilty
plea to Count Two of the Indictment, which charged him with
aiding and abetting the embezzlement of monies and other assets
of the welfare and pension benefit plans of the District Council
Benefit Funds. That charge carries a maximum sentence of five
years’ imprisonment; a maximum fine of the greatest of $250,000,
twice the gross pecuniary gain derived from the offense or twice
the gross pecuniary loss to persons other than the defendant
resulting from the offense; a term of supervised release of three
years and a mandatory $100 special assessment.
ANNUCCI is awaiting trial, currently scheduled for
January 2008. The charges against ANNUCCI contained in the
Indictment are merely accusations, and the defendant is presumed
innocent unless and until proven guilty.
Assistant United States Attorneys LISA ZORNBERG and
KATHERINE GOLDSTEIN are in charge of the prosecution.
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