10.1.99
00:16:28
Coia to resign
in deal with prosecutors, officials say
The Laborers' union president,
under federal scrutiny for years along with the union, is expected to
step down this month.
By JOHN E. MULLIGAN
Journal Washington Bureau
WASHINGTON -- Laborers' union General President
Arthur A. Coia, a major Democratic fundraiser who once swapped fancy
golf clubs with President Clinton, plans to resign this month as part of
a bargain with federal prosecutors, according to government officials
familiar with the case.
The bargain stems from Coia's transactions with a Rhode Island Cadillac
dealer who was a union vendor and who helped Coia to buy a $450,000
Ferrari, according to The Daily Labor Report, an industry newsletter,
and The New York Times.
Coia, 56, of Barrington, was convicted last March by a union tribunal,
in a noncriminal proceeding, of conflict of interest in the car deal. He
was fined $100,000.
Officials said that Justice Department plea negotiations with Coia
produced a deal under which he would quit his post with the Laborers,
one of the nation's largest and most corruption-plagued construction
unions, by Oct. 15, and enter a plea later.
But one government official said news reports about the deal ``could
jeopardize an agreement that's still in the works.''
The union's spokesman, David Roscow, was asked yesterday whether Coia
would resign as part of a plea agreement. ``You know, rumors have been
out there for a long time,'' Roscow answered. ``He has not resigned. He
has not been indicted and he has not reached an agreement'' with
prosecutors.
Later, Roscow called The Providence Journal to revise his earlier
statement. ``I know of no plans of his resignation or retirement,'' he
said.
Coia and his lawyer did not answer requests for interviews. A spokesman
for the Justice Department in Washington declined to comment. A
spokesman for Rhode Island's U.S. attorney, Margaret E. Curran, did not
respond to a message requesting comment.
Coia and the Laborers International Union of North America have been
under federal scrutiny since President Ronald Reagan's administration.
In 1994, less than two years after Coia took office, the Justice
Department presented him with a draft racketeering suit that accused him
of tolerating Mafia influence in the union. The document called for a
federal takeover of the union.
Instead, Coia and his lawyers negotiated a deal in February 1995 that
let him preside over an internal cleanup of the union. The agreement
specified that federal prosecutors could continue, separately, to
investigate any union officer.
Union dissidents, later echoed by congressional Republicans, complained
bitterly that the deal was a case of the fox -- the politically
well-connected Coia -- minding the chicken coop.
But the Justice Department has, by and large, defended the
anti-corruption effort as a success. In 1996, congressional
investigators saw potential conflict of interest in the Laborers-Justice
deal, but found no evidence of impropriety.
In November 1997, the union's anti-corruption office brought charges
against Coia himself. They were tried over a period of several weeks in
1998 at secret hearings in Washington, Chicago and Providence.
The hearing officer for the internal case, Peter F. Vaira, ruled March 9
that Coia had avoided federal luxury taxes on the Ferrari F40, thanks to
the ``unique opportunity'' that Carmine Carcieri gave him to structure a
special-purchase deal in 1991.
But Vaira said it was not for him to decide on the in-house prosecutor's
charge that Coia had committed a felony evasion of $42,000 in federal
taxes in his dealings with Carcieri, proprietor of Viking
Oldsmobile-Cadillac-GMC of Middletown.
Vaira similarly declined to rule on the internal charge of civil tax
fraud against Coia.
The report by internal prosecutor Robert D. Luskin on the Coia-Carcieri
deal ``can easily be referred to the IRS, an organization always eager
to collect taxes,'' Vaira wrote. He added that he ``would be surprised
if such referral has not already been made.''
Vaira ruled that Luskin failed to provide any evidence for his
allegation that Coia's Ferrari deal with Carcieri had also avoided
$33,750 in Rhode Island taxes. He also ruled that while Carcieri had
given Coia a ``benefit,'' the deal entailed ``no kickbacks.''
But Vaira said Coia's deal with his old friend Carcieri, who held the
$1-million-a-year national contract to lease cars to Laborers officers,
created ``a definite conflict of interest and an appearance of
impropriety.''
Vaira also ruled that the internal prosecutor had failed to give enough
evidence for a number of separate charges that Coia had associated with
mobsters.
Coia's Washington lawyer, Howard Gutman, declined to comment in March
when asked whether Coia's dealings with Carcieri had been lawful. Coia
did not appeal the internal conflict-of-interest conviction or the
$100,000, payable over two years.
Deputy Atty. Gen. Eric Holder declined to comment in March on whether
the Justice Department was pursuing charges against Coia. But two top
subordinates pronounced themselves ``disappointed with the decision'' by
Vaira and urged Luskin to appeal.
Luskin did so. In August, the union appeals officer, W. Neil Eggleston,
upheld Vaira's decision. Dissidents have criticized the internal hearing
process, noting that the prosecutor, hearing officer and appeals officer
are all paid by a union board that Coia controls. They have also noted
that Eggleston was for a time a Clinton White House lawyer.
But the Justice Department has continued to defend the anti-corruption
effort and has not exercised its power, under its 1994 agreement with
the Laborers, to close the reform office and take over the union.
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