Grand Jury to Look at Teamster Chief’s Role as FBI Informant

A federal judge ruled Wednesday that a Cleveland-based federal grand jury investigation, rather than a new trial for Jackie Presser’s uncle, is the proper forum for establishing the facts about Presser’s role as an FBI informant.

U.S. District Judge Sam H. Bell permitted the Justice Department to dismiss its fraud case against Allen Friedman, the convicted uncle of the controversial Teamsters Union president, even though Friedman wanted a chance to prove his contention that FBI agents had entrapped him by secretly encouraging Presser to hire him as an illegal “ghost employee” of Cleveland Teamsters local 507.

Bell said in a 20-page opinion that “the court cannot force the government to go to trial.” The Justice Department had told Bell that it preferred to free the imprisoned Friedman rather than disclose confidential materials that might bear upon Presser’s cooperation with the FBI at a new trial.

‘Explanation Is Due’

Bell ruled that “an explanation is due” from the Justice Department as to why Presser’s role as a government informant was improperly withheld from federal prosecutors who tried and convicted Friedman two years ago on labor fraud charges.

But the judge declared that “the grand jury is the preferred and proper forum for such action, particularly when that inquiry is being pursued by an independent section of the Department of Justice, the Office of Professional Responsibility.” The office, the department’s watchdog unit, enjoys substantial independence.

As a result of the grand jury’s inquiry, which Bell himself initiated in recent weeks, “the public interest . . . is not diminished by granting the motion to dismiss” all charges against Friedman, Bell said.

Friedman, who has served 11 months in prison for accepting $165,000 in union funds as a no-show employee of Presser’s hometown local, “is disappointed that he cannot have a new trial to clear his name,” his attorney, Dennis Levin, told reporters.

Will Sue Government

However, Levin said that Friedman is relieved to be a free man again. “Now we will turn our attention to filing a multimillion-dollar civil damage suit against the government,” he said.

“There was obstruction of justice by the FBI in failing to disclose information to the Department of Justice about their activities with Mr. Presser,” Levin said. “As a result, Mr. Friedman spent nearly a year in prison.”

Friedman moved for a new trial last August after the Justice Department dropped its three-year investigation of Presser on charges that he had misspent hundreds of thousands of dollars in union funds on five “ghost employees.”

Government officials said the long investigation was abandoned after Presser’s lawyer argued successfully that Presser’s activities had been condoned by the FBI--an arrangement that had not been made known to federal prosecutors in Cleveland.

Immunity Rejected

In a related development Wednesday, it was learned that the Justice Department has turned down a request by the President’s Organized Crime Commission to grant immunity from prosecution to Presser so that the commission could compel him to answer questions about alleged links between the Teamsters and organized crime.

Presser invoked the Fifth Amendment privilege against self-incrimination when he appeared twice before the commission and its attorneys. The second occasion was in August, after the Justice Department had dropped plans to seek Presser’s prosecution on labor fraud charges.

A source familiar with the department’s refusal to allow Presser to testify said that, although plans to prosecute him had been dropped, there still could be “legal complications” stemming from the grand jury inquiry in Cleveland and other investigations.

Robert L. Jackson reported from Akron and Ronald J. Ostrow reported from Washington.