The financial damage coming out of the Bernard Madoff investment scandal is now spreading from charities and wealthy individuals to labor union pension funds. In recent days, several union leaders have confessed to being caught up in Madoff’s investment scheme, which will result in massive pension losses to their members.
One union, the Carpenters local in Syracuse, N.Y. lost the majority of the $100,000 million to$150 million it had in pension money because of its dealings with Madoff, people close to the matter said.
Plumbers and Steamfitters Local 267 is reporting that it has lost $48 million dollars from its pension fund. A letter from the union says all of its funds have been impacted by Madoff, and it’s still unclear how much money was lost.
A Roofers union local says Bernie Handoff’s scam may have cost its pension fund an estimated $14 million, about 15 percent of the total. Some members are saying there is only enough money in the fund to pay current retirees through the next five months or so.
Members of Operating Engineers Local 545 were notified last month by the administrator of the Engineers Joint Board that about 15 percent of the joint pension funds had been lost through investments with Madoff. Losses to the Welfare Fund, SUB Fund and Training Fund are much higher, but have yet to be assigned a dollar value.
We Ought to Be Told What’s Happening to Our Dues Money?
Organized labor at all levels has hundreds of millions of dollars invested in stocks, bonds, banks, corporations and other profit-making ventures, but it is amazing how little we know about how our money is spent, and that our leaders just won’t tell us.
There’s no question that both the AFL-CIO and Change to Win have suffered losses during the global economic slowdown, but how much? Neither of them has dared to inform members of the losses we’ve incurred the past few months
But there’s a larger question: How are our leaders spending the hundreds of millions of dollars they get from our dues money every year? Aren’t we entitled to have a breakdown of how much they’ve spent on organizing, conferences, salaries, political campaigns and other activities? We’re not getting that information until enough of us raise our voices and demand it.
With so much money around, it’s an invitation and motivation for wild, risky investments, for exorbitant expense accounts, for hiring high-priced consultants who are not really needed — all of this from our dues money. We’re not making any charges, but the temptation for embezzlement can be seductive.
vWe must put an end to this outrageous, tight-fisted denial of our rights. We must demand periodic reports of what they are doing with our money,
If they don’t comply, we should consider withholding our dues payments until they do.
On Thursday, February 12 (Lincoln’s Birthday), there will be a press release announcing an important endorsement by Labor’s Voice for Change.