Three Union Timekeepers Sentenced for Wire Fraud in Scheme to Defraud Ports America Baltimore
Claimed Regular and Overtime Hours When They Were Actually on Vacation or At Home
Baltimore, Maryland - U.S. District Judge Catherine C. Blake sentenced William Richard Zichos, Jr, age 59, of Arnold, Maryland to a year and a day in prison followed by three years of supervised release; Dale Martin Kowalewski, age 55, of Reisterstown, Maryland to 10 months in prison, followed by two months of home detention as part of three years of supervised release; and Joseph Ross Bell, age 68, of Cockeysville, Maryland to six months in prison, followed by six months of home detention as part of three years of supervised, for conspiracy to commit wire fraud and wire fraud, in connection with a scheme to defraud Ports America Baltimore, the stevedore and terminal operator at the Port of Baltimore. Judge Blake also ordered that the defendants were jointly liable to pay $39,874 in restitution, which they paid today at sentencing.
The sentences were announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Robert L. Panella, Special Agent-in-Charge for the Washington Region of the U.S. Department of Labor’s Office of Inspector General, Office of Labor Racketeering and Fraud Investigations.
“The evidence showed that the defendants used their positions as timekeepers to falsify their attendance reports and receive salary payments for lengthy periods of time when they were not at work, including many occasions when they were on vacation overseas,” said U.S. Attorney Rod J. Rosenstein.
“Today’s sentencings represent the OIG’s long standing commitment to investigate union corruption and fraud. We will continue to aggressively pursue those individuals who abuse their positions for personal gain at the expense of companies and union workers,” stated Robert Panella, Special Agent-in-Charge for the Washington, D.C. Region of the U.S. Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations.
According to evidence presented at their eight day trial, Zichos, Kowalewski and Bell were employed by Ports America as timekeepers with International Longshoremen’s Association (ILA) Local 953, which was the local union for steamship checkers, weighers, and timekeepers at the Port of Baltimore. The defendants were required to take attendance of dockworkers assigned to work particular shifts and record the amount of hours they worked to unload and load cargo vessels berthed at the Port of Baltimore. The defendants were primarily stationed at Building 1200A at the Dundalk Marine Terminal, commonly referred to as the “timekeeper’s shack.” The timekeepers collected attendance information for the dockworkers before and during the work shifts and recorded it on daily time sheets, then submitted to a supervisor at Ports America. The timekeepers recorded their own attendance, completed their own time sheets and entered their own payroll data for the shifts they were assigned to work.
The evidence at trial showed that from October 2004 to February 2008, Zichos, Kowalewski and Bell certified to Ports America and the STA that one of the codefendants was present at the Port of Baltimore working as a timekeeper during a particular shift when in fact the codefendant was elsewhere. The defendants entered false information into Ports America’s payroll database to inflate the number of hours for which an absent codefendant was to be paid wages and fringe benefits.
For example, testimony showed that Bell submitted wage and hour information falsely representing that Zichos had worked straight and overtime hours at the Dundalk and Seagirt Marine Terminals when in fact he was vacationing in Paris, France; piloting his boat from Fort Myers, Florida to Maryland; vacationing in San Jose, Costa Rica; and when Zichos was on board a European cruise. The evidence further showed that Zichos and Bell submitted wage and hour information falsely representing that Kowalewski had worked straight and overtime hours at the Dundalk and Seagirt Marine Terminals when Kowalewski was in fact vacationing in: Paris, France; Orlando, Florida; Reykjavik, Iceland; and Las Vegas, Nevada. In addition, evidence was presented which showed that Zichos and Kowalewski submitted information falsely representing that Bell had worked straight and overtime hours at the Dundalk and Seagirt Marine Terminals on several occasions when Bell was either in the hospital or at home recovering from surgery. According to the trial evidence, through this scheme the defendants caused Ports America to pay wages and benefits of approximately $41,656 for hours they did not work.
United States Attorney Rod J. Rosenstein thanked the U.S. Department of Labor - Office of Inspector General, Office of Labor Racketeering and Fraud Investigations for their investigative work. Mr. Rosenstein commended Assistant United States Attorneys Martin J. Clarke and Stephen M. Schenning, who prosecuted the case.