Former Teamsters president Ron Carey indicted
Carey was ousted as president of the Teamsters in 1996, following a fundraising scandal
NEW YORK (CNN) -- Former Teamster President Ron Carey was indicted Thursday for allegedly committing perjury and making false statements during the investigation of a fundraising scandal that led to his downfall as head of the nation's largest private sector union.
The 39-page, seven-count indictment, announced by U.S. Attorney Mary Jo White, charges Carey with lying to government-appointed officials and to the grand jury investigating fundraising improprieties in Carey's 1996 campaign for a second five-year term as president of the 1.4 million member union.
Carey, 64, who took charge of the union as a reform candidate pledging to clean up its long history of corruption, won re-election in December 1996 by narrowly defeating James P. Hoffa, the son of legendary Teamster boss Jimmy Hoffa who disappeared in 1976, the apparent victim of an underworld hit.
In the wake of the fundraising scandal, government-appointed election monitors invalidated the Carey victory, ordered a new election and barred Carey from running again.
The union subsequently expelled Carey, a member for 40 years since his first job as a UPS truck driver in Queens.
Hoffa beat two other candidates in the December 1998 vote and assumed leadership of the union on May 1, 1999.
"The member of the Teamsters Union have paid a terrible price for the misdeeds of Ron Carey. Their hard-earned dues money was squandered away by his illegal activities," Hoffa said in a statement released Thursday.
In the illegal fundraising scheme, Carey's '96 campaign received several hundred thousand dollars in tainted funds. In a classic kickback scheme, several liberal groups received large donations from the Teamsters treasury totally $885,000, and those groups in turn made or arranged for reciprocal contributions to the Carey campaign.
The criminal charges stem from statements Carey made under oath denying knowledge of diverting funds to four political groups, which included one of the Teamsters' largest ever donations -- $475,000 to Citizen Action, a consumer and environmental advocacy group.
Project Vote, an organization that mobilizes minority and low income voters, received $175,000 and the National Council of Senior Citizens received an $85,000 in Teamster funds.
Carey's former campaign manager, Jere Nash, and a political consultant, Martin Davis, pleaded guilty to charges stemming from the scheme in September 1997. They have yet to be sentenced and could testify against Carey.
Most of the laundered money was sought for a $700,000 direct mail campaign conceived by Nash and Davis to Teamster members in the closing weeks of the union election, prosecutors say.
The union's former political director under Carey, William Hamilton, is serving a three-year sentence for participating in the scheme. A federal appeals court upheld Hamlton's conviction earlier this week.
Carey has repeatedly said he was not aware of the scheme.
"What took place here is against everything I believe in, everything I worked for. It was a betrayal," Carey said when the scandal emerged three-years ago.
Carey was the first Teamster president in the union's history to be directly elected by the union's rank and file. The secret ballot in the U.S.-government supervised election in 1991 came after a 1989 agreement between the union and the Justice Department, a "consent decree" whereby the union promised to end its mob ties and the government agreed to drop pending racketeering charges.
Carey's lead attorney, Reid Weingarten, told CNN in a telephone interview that Carey is "a hero of the labor movement and not a criminal."
"He took over a throroughly corrupt union and cleaned it up," Weingarten said, referring to his ousting more than 400 union officials and slashing his salary and perks for union leaders.
"He threw out true mobsters at great risk to his personal safety. He worked closely with federal authorities to rid the union of a bad element, and this is his reward," Weingartn said.
Carey also led the sucessful strike against UPS, the nation's largest employer of Teamsters, in 1997.
"We will contest these charges until he is fully vindicated and he will be fully vindicated," Weingarten said.
Carey's arraignment in U.S. District Court in lower Manhattan is scheduled for next Thursday, Feb. 1, at 10 a.m.
CNN Justice Department Producer Terry Frieden contributed to this report
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