Former CWA Local President Pleads Guilty to Embezzlement and Bank Fraud
BIRMINGHAM – A former president of the Communications Workers of America, Local 3901, in Oxford, Ala., pleaded guilty today in federal court to a scheme to embezzle more than $69,000 from the local chapter, announced Acting U.S. Attorney Robert O. Posey and U.S. Department of Labor, Office of Labor-Management Standards, Investigator Hollis Lindley Jr.
MICHAEL LACKEY, 44, of Bremen, Ga., entered his guilty plea to five counts of bank fraud and one count of embezzlement and theft of union funds before U.S. District Judge Virginia Emerson Hopkins. A federal grand jury indicted Lackey in November. As part of his plea, Lackey agreed to repay $69,193 to the union and to forfeit that same amount to the government as proceeds of illegal activity. Lackey is scheduled for sentencing April 25.
Local 3901 members elected Lackey president in October 2008 and he remained in that position until October 2014. As president, Lackey exercised control over the local’s finances, including its accounts at Wells Fargo and Regions banks.
According to his plea agreement with the government, Lackey executed a scheme to defraud the banks and Local 3901 between February 2010 and October 2014 by using his position as Local 3901 president, and acting treasurer, to conduct unauthorized transactions to take money from the CWA local’s bank accounts and use it for his personal benefit. Those transactions included writing checks to himself from Local 3901 accounts for unauthorized or nonexistent travel expenses, using debit cards he obtained on accounts for the local at both Regions and Wells Fargo for personal expenses, and making cash withdrawals from Local 3901 accounts at both banks for his personal use.
The checks he wrote to himself from union funds totaled about $26,519; the cash withdrawals and personal expenditures he made with the union’s debit cards totaled about $14,095; counter cash withdrawals totaled about $16,032; personal power bill payments totaled about $3,092; personal loan payments totaled about $7,201; and accumulated bank fees totaled about $2,251, for a total embezzlement of $69,193, according to the plea agreement.
Lackey attempted to conceal his theft by failing to maintain records of his unauthorized transactions and by failing to seek approval for expenditures, as required by federal law and the Local 3901 constitution and bylaws.
Local 3901 members began to suspect in summer 2014 that Lackey had stolen money from the union when a union check bounced. About the same time, Lackey told a national CWA AFL-CIO representative that he had taken out a personal loan using the union’s bank accounts and assets as collateral, and had failed to make the loan payments, leading the bank to collect from the union’s finances, according to the plea agreement.
The maximum penalty for bank fraud is 30 years in prison and a $250,000 fine. The maximum penalty for embezzlement is five years in prison and a $10,000 fine.
The U.S. Department of Labor, Office of Labor-Management Standards, investigated the case, which Assistant U.S. Attorney Xavier O. Carter Sr. is prosecuting.