Carpenters union subpoenaed in N.J. federal grand jury probe
“We do not know the reason for the subpoenas, but we intend to fully cooperate with the U.S. Attorney’s Office,” reads an internal memo, on president Douglas McCarron’s letterhead.
Federal prosecutors in New Jersey aren’t done with the politically influential carpenters union.
Two months after a former New Jersey benefits manager was charged with allegedly embezzling more than $1.5 million in union funds, the United Brotherhood of Carpenters and Joiners of America was subpoenaed as part of a grand jury investigation, according to an internal memo sent last week by union leadership.
“We do not know the reason for the subpoenas, but we intend to fully cooperate with the U.S. Attorney’s Office,” reads the memo, on president Douglas McCarron’s letterhead.
Though the subpoenas target the international union and several companies that it operates, much of the attention over the last year has been on the New Jersey local, whose leaders are allied with the state’s powerful political leader George Norcross and which has been plagued with allegations of corruption.
News of the subpoenas comes almost a year after John Dougherty and other leaders at the International Brotherhood of Electrical Workers Local 98 electricians union in Philadelphia — another politically powerful building trades union in the region — were charged in a federal indictment that accused them of stealing more than $600,000 in union funds.
The carpenters’ pension fund and an organization called “UBC Mission Venture” was subpoenaed, according to the memo, as was Calibre CPA Group, an accounting firm based in Bethesda, Md., that audited the union’s 2018 financial statements. Several subsidiaries of the union were also subpoenaed:
Placid Ventures, which owns a number of businesses including Level Care Pharmacy I, Level Care PBM II, and Jobsite Steel Manufacturing.
Level Care Pharmacy I, a Las Vegas pharmacy opened in 2018 to serve the union’s members.
Level Care PBM I and II. (Pharmacy benefit managers, or PBMs, handle prescription drug benefits for health plans and have come under fire from state legislators who are concerned about potential waste and fraud.)
Jobsite Steel Manufacturing, which runs manufacturing facilities in Tennessee and Nevada and “secure[s] employment for Carpenter members," according to the union’s most recent financial statement.
McCarron did not immediately return a request for comment. The U.S. Attorney’s Office in New Jersey said it does not confirm or deny investigations.
In 2018, a high-ranking New Jersey union official and Gov. Phil Murphy ally, Frank Ballantyne, filed a whistleblower lawsuit saying that international union leaders retaliated against him for revealing what he called "self-dealing and corruption.” The lawsuit was later settled and the terms were not disclosed.
Since then, George Laufenberg, the former benefits manager for the union’s New Jersey and New York members, has been charged with stealing from the union’s benefits fund. Laufenberg was a Gov. Chris Christie appointee to the Port Authority of New York and New Jersey from 2014 to 2017. Laufenberg was fired from the union in late 2016.
The union represents more than 500,000 construction workers across the country, including those in Philadelphia and New Jersey. The Philly region arm is part of the Keystone + Mountain + Lakes Regional Council of Carpenters, which represents 42,000 workers from North Carolina to Pennsylvania. Two of four leaders on the international executive board hail from what used to be the union’s New Jersey Regional Council: general vice president Frank Spencer and general secretary-treasurer Mike Cappelli.
Staff writers Jeremy Roebuck and Craig R. McCoy contributed to this report.