Former United Auto Workers union leader pleads guilty of accepting bribes

ANN ARBOR, Mich. – As United Auto Workers union leaders negotiate a new contract this week with General Motors executives, a former union negotiator admitted to the court that he has received at least $ 1.5 million in commissions from his vendors.

Michael Grimes, a retired senior executive of the union's GM division, pleaded guilty on Wednesday to charges of wire fraud and money laundering. He incurs up to 20 years in prison for the charges. However, the prosecutor recommended Grimes to serve a sentence ranging from 46 to 57 months. The sentence is scheduled for January 14 in Detroit.

Prosecutors have not publicly connected GM or its leaders to Grimes as they did in a separate corruption case involving Fiat Chrysler and UAW leaders. There were also no allegations. Grimes shares were supposed to have an impact on UAW negotiations with GM as well as with the Italian-American automaker.

"The conduct admitted today by Mr. Grimes in his plea is shocking and absolutely outrageous," said the UAW in a statement, adding that she had since implemented a series of amendments intended to to improve its internal procurement process. GM did not immediately comment on the Grimes case. The company had previously told CNBC that Grimes' conduct was "deeply troubling" and that it was cooperating fully with the investigation.

Grimes' guilty plea was part of an agreement with federal prosecutors. Michael P. Manley, a Grimes lawyer, declined to say whether or not his client cooperated with prosecutors in the ongoing investigation.

"Mr. Grimes is devastated by his actions," Manley told reporters after the hearing. "It's been more than 30 years since he spends his time at the UAW, he loves the UAW, he is overwhelmed by all that he has done to their reputation. acts and will suffer greatly. "

Grimes, while answering questions from prosecutors and US District Judge Bernard Friedman, said he was facing a "financial burden" to justify his crimes. Grimes, dressed in a black suit with a silver-checkered tie, offered only another glimpse of his deeds, aside from answering direct questions. The union paid Grimes $ 140,000 in 2017, his last year of full employment before retiring last year.

The Grimes Appeal is a major step in a multi-year investigation conducted by the Department of Justice on one of the largest American unions. Grimes is the first person not affiliated with Fiat Chrysler to be charged as part of the investigation, which had already led to the conviction of eight representatives of unions and affiliates at the Italian-American automaker.

Grimes was one of three union officials identified in unsealed court documents on August 14 as receiving bribes and bribes from vendors who were under contract to produce goods, including hats, watches, shirts and other items. "

Wednesday's prosecutors have not identified the other people in the documents. Manley also refused to identify them. "We will leave it up to the government to identify anyone not named yet," he said.

Sources quoted by the Detroit News had previously identified them as the retired Vice President of the UAW, Joe Ashton, and one of his senior lieutenants, Jeff Pietrzyk. Neither has been charged.