Presser, 2 Aides, FBI Man Indicted : Unionists Accused of Payroll-Padding, Agent of Lying to Help Teamster Boss

Times Staff Writers

Teamsters President Jackie Presser and two long-time union associates were indicted Friday on federal charges of siphoning off more than $700,000 over 10 years from the Teamsters and the Bakery Workers Union in a payroll-padding scheme.

In a related action, an award-winning FBI supervisor was charged with covering up meetings he allegedly held with Presser and two others to devise a strategy for blocking Presser's indictment. In addition, he is charged with four counts of making false statements to FBI and Justice Department investigators.

The FBI official is Robert S. Friedrick, 42, supervisor of the organized crime squad in the FBI's Cleveland office, who has been with the bureau for 13 years. He is accused of repeatedly stating falsely while under oath that Presser had FBI authorization to make union payments to "ghost employees" who did no work. Presser was an FBI informant for many years.

Reelection Expected

Presser's indictment resulted from the recently resumed investigation of the politically powerful labor leader and occurred virtually on the eve of his still-expected reelection to a five-year term at the Teamsters' convention in Las Vegas next week.

The indictment by a federal grand jury in Cleveland--the site of his hometown Teamster Local 507, of which he is still secretary-treasurer--means that Presser follows in the footsteps of three of his four predecessors as Teamster president. All three were subsequently convicted.

In a statement from Las Vegas, Presser, 59, said that he welcomes his day in court to end what he called "a five-year pattern of insinuations and leaks of false information," and he accused the government of "building nothing more substantial than a house of cards" against him and the other Teamster defendants.

The other two Teamsters indicted are Harold Friedman, 64, a vice president of the international union and president of Local 507 and of Bakery Workers Local 19, which is also based in Cleveland, and Anthony Hughes, 50, recording secretary of Local 507 and a business agent for Bakery Workers Local 19.

Friedman's lawyer, Robert J. Rotatori, said that last year the Justice Department decided not to proceed against his client "because the case lacked merit. This new indictment is obviously based on events and occurrences totally unrelated to Harold Friedman or the facts of the case, and therefore is improper."

Hughes could not be reached for comment.

If Presser, Friedman and Hughes are convicted of the labor-racketeering counts against them, the Justice Department said, it will seek to strip them of all their union posts.

Terry Eastland, the department's public affairs director, said that the indictments of the Teamster leaders and the FBI supervisor "demonstrate that we have a department and a government in which the people can take confidence."

The legal actions "should end early gossip that partisan politics influenced the Department of Justice" in the politically sensitive case, Eastland said. "Partisan politics have never entered this case--for or against" indictment.

The case had taken on political overtones because Presser was the only major labor leader to support President Reagan in the 1980 and 1984 elections, served as a labor adviser on the President's transition team and was chairman of Reagan's labor inaugural committee. His relationship with the White House led Atty. Gen. Edwin Meese III to remove himself from any role in the case, citing his earlier service as presidential counselor.

11th-Hour Plea

Friday's action culminated an on-again, off-again investigation that began in 1982. Last year, the claim of official authorization for the otherwise illegal acts of payroll-padding supported an 11th-hour plea in June by John R. Climaco, Presser's lawyer and the Teamsters' general counsel, that led to an initial decision by the Justice Department to reject prosecutors' recommendations that Presser be indicted.

The department recently reversed that initial decision, which had been made a month after Climaco's plea, and decided to resume the case after an internal investigation determined that the claim that Presser had been authorized by the FBI to make payments to "ghost employees" was false.

Two other FBI men who previously headed the Cleveland office's organized crime squad and who, like Friedrick, oversaw Presser's work as a "top echelon" informant for the FBI, also are under investigation, according to Justice Department sources.

They are Patrick Foran, now assistant special agent in charge of the FBI's Las Vegas office, and Martin P. McCann, who retired from the FBI and is now a security official with LTV Steel in Cleveland. Eastland refused to comment on whether they would be charged, saying that the "investigation is continuing."

'Turf Battle'

Friedrick's lawyer, William D. Beyer, said that his client "is a casualty in a turf battle over the separate responsibilities of the Justice Department, the FBI and the Labor Department."

Labor Department investigators--not FBI agents--served on the federal organized crime strike force in Cleveland that conducted the three-year Presser investigation. That strike force recommended the indictment that initially was rejected by the Justice Department.

Friedrick, a Naval Academy graduate who requested reassignment to Vietnam after being seriously wounded there while leading a Marine platoon, was honored by the FBI for his work on a 1977 gangland murder case involving two warring Mafia families.

A Justice Department official said that Presser will surrender to federal marshals in Cleveland today, when bail will be set. Formal arraignment probably will not be occur until after the Teamster convention, which concludes next Friday.

In spite of the indictment--and possible political fallout that it could produce--the Teamster convention will open Monday with a keynote address by Labor Secretary William E. Brock. In fact, the indictment is expected to aid Presser's reelection by bolstering Presser's argument that he is the victim of a political vendetta.

The indictment alleged that Presser, Friedman and Hughes violated the provisions of the Racketeer Influenced and Corrupt Organization statute with multiple acts of embezzlement from as early as Jan. 1, 1972, until at least Dec. 31, 1981.

Presser and Friedman were charged with maintaining on the Local 507 payroll three employees who did no work. The three--Allen Friedman (Presser's uncle), Jack Nardi Jr. and George Argie--were named co-conspirators but were not charged.

Nardi pleaded guilty to receiving "ghost worker" payments, and Allen Friedman was convicted of the same crime. But the Justice Department allowed their convictions to be dropped when their lawyers sought information on Presser's service as an FBI informant.

However, department spokesman Eastland maintained Friday that the cases against them were dropped because of Friedrick's false claim that they had FBI authorization to receive the union payments.

The Presser case, which has been unusual from the start, continued to be handled in other than standard ways Friday.

Friedrick's indictment, for example, actually was returned by a grand jury here Thursday but immediately was sealed. The usual reason for keeping an indictment secret is to arrest defendants who authorities fear will flee--a reason lacking in Friedrick's case.

Eastland said the announcement was delayed until the Teamster indictments in Cleveland so that government officials could discuss them "intelligently" as a package. He denied that the delay was an attempt to turn two stories into one or to subordinate the charges against the FBI man.

Unusual Sentences

And the Justice Department's six-page announcement of the Presser-Friedman-Hughes indictment closed with an unusual two sentences: "An indictment is only a charge and not evidence of guilt. The defendants are entitled to a fair trial, in which it will be the government's burden to prove guilt beyond a reasonable doubt."

A Justice Department source, who asked not to be named, said that the sentences were "an accommodation to some judges in Cleveland," who like to have that qualification included in indictment announcements.

Presser is the fourth Teamsters president indicted on criminal charges. The first, Dave Beck, was convicted in 1959 of income tax violations. He was succeeded by James R. Hoffa, who was convicted in 1964 of jury tampering and disappeared in 1975.

The next Teamster president, Frank E. Fitzsimmons, was never indicted and died in office in 1981.

Roy L. Williams served from 1981 until 1983, when he was convicted of conspiracy to attempt to bribe a U.S. senator.

A presidential commission concluded recently that Teamsters leaders have been under the influence of organized crime since the 1950s.

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

Copyright © 2019, Los Angeles Times
EDITION: California | U.S. & World