Skip to content
Link copied to clipboard

Sources: Federal authorities set to announce charges in Local 98 investigation Wednesday

It remains unclear whether outspoken labor leader John J. Dougherty – widely known as Johnny Doc – City Councilman Bobby Henon, or other top officials of Local 98 of the International Brotherhood of Electrical Workers will face charges.

IBEW Local 98 union leader John J. Dougherty spoke to reporters as FBI agents conducted a search of his home on Aug. 5, 2016, as part of an extensive federal investigation. Prosecutors are expected to announce the results of that investigation on Wednesday.
IBEW Local 98 union leader John J. Dougherty spoke to reporters as FBI agents conducted a search of his home on Aug. 5, 2016, as part of an extensive federal investigation. Prosecutors are expected to announce the results of that investigation on Wednesday.Read moreCHARLES FOX / Staff Photographer

>> UPDATE: Feds indict Johnny Doc, Councilman Bobby Henon in IBEW Local 98 investigation

Federal authorities are expected on Wednesday to announce criminal charges against labor leader John J. Dougherty, City Councilman Bobby Henon and at least three other officers of their union, Local 98 of the International Brotherhood of Electrical Workers, two sources familiar with the investigation said.

The exact nature of the charges — and the precise number of people facing prosecution — remained unclear. But the sources, who were not authorized to publicly discuss the case, said that all those facing charges are expected to turn themselves in to authorities within days.

Both Dougherty — widely known as “Johnny Doc” — and Henon, who holds a paid position with the union, have repeatedly denied wrongdoing.

Nonetheless, the case against them, threatens to destabilize not only the leadership top of one of the region’s most politically powerful unions but also the futures of dozens of Local 98 allies in elected office and the landscape of organized labor in one of the last American cities in which unions remain a powerful force.

Lawyers for both Dougherty and Henon declined to comment Tuesday. In a statement, Henon’s office said, he had no plans to resign.

“He is confident that his colleagues will respect any possible upcoming legal process and support him,” the statement read. “Councilman Henon is a dedicated public servant and will continue to serve as councilman.”

A glimpse of what’s to come emerged late Tuesday afternoon, when prosecutors charged James E. Moylan — Dougherty’s chiropractor, a South Philadelphia neighborhood activist, and Mayor Kenney’s former appointee to lead the Zoning Board of Adjustment — with stealing from a nonprofit he founded as well as from Local 98’s charitable arm.

A day earlier, George Peltz, a New Jersey electrical contractor and a childhood friend of Dougherty’s, became the first person to plead guilty as part of the case.

Those indictments came more than two years after the joint investigation by the FBI and IRS burst into public view with simultaneous August 2016 raids on more than a dozen union sites as well as homes and offices of key Local 98 officials and allies.

Search warrants — obtained by the Inquirer — indicate that agents’ interests ranged from Local 98’s voluminous political giving to allegations of work-site intimidation and misspending of union funds.

Possible charges included embezzlement, attempted extortion of contractors, fraud, tax evasion, and honest services fraud by public officials, the legal documents said.

Since then, sources familiar with the probe who were not authorized to discuss it publicly described the case as a multifaceted examination of the methods by which the union has exerted its considerable clout — with Dougherty at its center.

In his 25 years at the helm of Local 98, Dougherty has built the 4,700-member organization into a potent political force, placing numerous allies — mostly Democrats — in elected and appointed municipal positions and amassing one of Pennsylvania’s biggest campaign war chests, making it the biggest independent source of campaign money in the state.

Union money and manpower have helped elect mayors, City Council members, county commissioners, members of Congress, state legislators, governors, and more than 60 judges — including the union leader’s brother, Kevin Dougherty, and other state Supreme Court justices.

John Dougherty’s attorney and a spokesperson for Local 98 declined to comment Tuesday. But the pugnacious labor leader has repeatedly proclaimed his innocence of any wrongdoing — as recently as last week in an interview with Fox29.

“Some people are vindictive. Most people just don’t understand my industry, and I play with a lot of powerful people who aren’t fond of me,” Dougherty said. “A lot of people in this town — most of the greedy elite — they don’t think much of me, OK? I’m white trash to them guys.”

Still, in the years since the FBI raids, Local 98 has taken steps to clear up any potential vulnerabilities that could draw investigators’ interest.

Dougherty repaid his union nearly $280,000 last year — an amount it said, in a filing with the U.S. Labor Department, that he had inadvertently used over the previous six years to cover personal expenses and legal fees.

Misspent union money also was at the heart of the charges filed Tuesday against Moylan, Dougherty’s chiropractor, who is also a childhood friend. Moylan resigned from the city’s Zoning Board of Adjustment days after FBI agents searched his home and office in 2016.

According to his indictment Monday, Moylan also ran a nonprofit called Neighborhoods for Fair Taxes, which received $50,000 in donations from Local 98’s coffers in 2013 after he wrote a letter to Dougherty.

Prosecutors said Moylan embezzled most of those funds, spending more than $45,000 on his personal credit card bills and home mortgage. He did not respond to calls for comment Tuesday.

Moylan joins Peltz — the New Jersey electrical contractor who pleaded guilty Monday — as the second key ally of Dougherty’s to face criminal counts.

Peltz admitted to providing more than $57,000 in home and office improvements — such as TV and security system installations — to an unnamed union official at no charge.

That work included security systems installed at a business co-owned by the official and the installation of large-screen TVs in homes of the official and the official’s relatives.

Peltz also acknowledged giving the same official $4,500 in gift certificates to Boyd’s, the Chestnut Street clothing store, in 2013 and 2016.

A spokesman for Dougherty declined to say whether Dougherty was the union official mentioned in court filings