Indictments cast shadow on Philadelphia construction industry
- The January indictments of union leader John Dougherty and others affiliated with Local 98 of the International Brotherhood of Electrical Workers for fraud, tax evasion, bribery and a bevy of other charges have made some question the influence that unions appear to have had on Philadelphia's construction industry, in the field and at city hall, according to Curbed Philadelphia.
- As a testament to the alleged far reach of Philadelphia unions, Dougherty, who has pleaded not guilty to the charges, is accused of not only using union funds as his “personal bank account” and other financial crimes, but also of enlisting city councilman and codefendant Bobby Henon to aid him in his agenda. Henon allegedly advanced legislation that would help Dougherty and the union and threatened to shut down projects that used non-union competitors of Local 98.
- Despite the hit, local union officials have said the legal action will not weaken city unions nor have an effect on Philadelphia’s construction projects. Ironically, as Henon was pleading not guilty to charges in the indictment, another council member reportedly had to step in and introduce a bill aimed at battling economic crimes in the city’s construction industry.
Officials in Pittsburgh have not gone as far as introducing specific legislation to address malfeasance in its local construction industry, but the city council did create the Joint Task Force on Construction Industry Fraud. The task force will focus on unfair trade practices, tax fraud and wage violations and will make policy and other long-term recommendations after it has reviewed local industry practices.
Sometimes lawmakers get together to combat specific acts of fraud, and that is the case in Florida’s Panhandle. State and local officials formed a construction fraud task force in Bay County, Florida, to combat the influx of unlicensed and sham contractors that descended on the area after last year’s Hurricane Michael. So far, law enforcement has arrested unlicensed contractors, primarily from out of state, in sting operations and is pursuing contractors who take deposits and leave work unfinished or do a substandard job.
One of the most robust fraud task forces is in New York City. Manhattan's Construction Fraud Task Force was launched by District Attorney Cyrus Vance Jr., who was motivated to act after the death of worker Carlos Moncayo, who died in a trench collapse on a city construction site. Task force members investigate safety, wage theft and public and private corruption violations. Vance’s office says that wage theft in the state of New York alone adds up to $1 billion in lost earnings each year.
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