Fake charity was tied to UAW-FCA scam, prosecutors say

on Sep21

Monica Morgan and her late husband, UAW Vice President General Holiefield. Photo credit: Facebook

DETROIT — Federal prosecutors seized $292,000 funds they allege were laundered through a fake hospice center in connection to corruption scandal by UAW and Fiat Chrysler Automobiles executives.

The government seized the funds, from two accounts, in February that were routed from the UAW-Chrysler National Training Center to a nonprofit controlled by late former UAW Vice President General Holiefield, which was then disseminated to a fake hospice center called Hospice of Metropolitan Detroit and ultimately to Monica Morgan, Holiefield’s wife, according to a forfeiture case filed Tuesday in U.S. District Court for the Eastern District of Michigan in Detroit.

The filing comes only months after a grand jury indicted former FCA Vice President Alphons Iacobelli and Morgan. The indictment alleges the two were linked to a scheme to siphon funds earmarked for employee training to line the their own pockets. More than $600,000 of which went to Morgan. Other legally prohibited payments to UAW and FCA officials were used for first-class trips, $37,500 solid-gold pens and a $350,000 Ferrari 458 Spider, according to the indictment.

Morgan and her husband, who died in 2015, were accused of criminally violating the National Labor Relations Act by embezzling $1.2 million. Iacobelli is suspected of pocketing $1 million.

Tied to the hospice, the conspirators used the Holiefield-controlled nonprofit Leave the Light On Foundation to funnel some of those funds, according to the recent forfeiture filing. Between July 2009 and June 2013, Iacobelli and former FCA financial analyst Jerome Durden allegedly approved transfers of $386,400 to the nonprofit. Durden, who struck a plea deal with prosecutors in August, served as its treasurer.

The foundation was designed to “help children who are struggling with hardships,” Holifield wrote in 2011 to potential funders, according to the court filing. But the majority of the funds were paid out to Morgan.

In 2014, the foundation deposited a $325,000 check for the Hospice of Metropolitan Detroit, which prosecutors allege was controlled by Mary Elon-Eloni Wilks. In exchange for transferring funds in $1,500 increments to Morgan, Wilks received $62,000 from the hospice funds.

The hospice, however, didn’t provide any hospice care, according to prosecutors.

Wilks has not been charged in the case. She could not be reached for comment by either the Detroit News or the Detroit Free Press, which both reported the story this week. 

FCA, according to the original June indictment, made annual transfers to the training center of between $13 million and $31 million from 2009 to 2014. The training center is a tax-exempt corporation established in 1985 to provide education and training to workers.

The UAW and FCA separately released statements condemning the actions, saying they have taken steps to correct the problem. FCA CEO Sergio Marchionne sent an email to employees, obtained by Automotive News, that denied knowledge of the actions. UAW executives followed suit.

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