Former Federal Employee Labor Union President Indicted In White Plains Federal Court For Stealing Union Funds

            Preet Bharara, United States Attorney for the Southern District of New York, Andriana Vamvakas, the New York District Director of the Department of Labor’s Office of Labor-Management Standards  (“DOL-OLMS”), and Jeffrey G. Hughes, Special Agent-in-Charge of the Northeast Field Office of the U.S. Department of Veterans Affairs, Office of the Inspector General (“VA OIG”), announced the indictment of WILLIAM DAVIS, a former president of the American Federation of Government Employees (“AFGE”) Local 1119 (the “Union”), for making at least $120,000 in unauthorized debit card charges and cash withdrawals from the Local’s bank account.  The Indictment charges DAVIS with one count of wire fraud and two counts of false statements in forms submitted to the DOL-OLMS.  DAVIS voluntarily surrendered to federal authorities yesterday morning, and was presented yesterday afternoon in White Plains federal court before United States Magistrate Judge Lisa Margaret Smith.

            According to the allegations in the Indictment[1]:

            The AFGE is a national labor union that represents approximately 670,000 workers employed by the federal government across all agencies and departments.  The Union is a local union chapter of AFGE that represents approximately 300 employees of the Veterans Affairs Medical Center-Montrose (the “Hospital”), and maintains offices on the Hospital’s campus in Montrose, New York.  At all times relevant to the Indictment, the Union maintained a checking account (the “Union Bank Account”) for Union funds, including members’ dues payments.

            From at least January 2008 through in or about October 2012, DAVIS served as the elected president of the Local.  As the president, it was DAVIS’s duty to preside over the Union’s meetings and conduct the day-to-day affairs of the Union.  During that time period, DAVIS used a debit card for the Union Bank Account (the “Union Debit Card”) issued to a deceased former Union officer to make hundreds of charges and cash withdrawals for non-Union expenses and without the authorization of the Union.  For example, DAVIS used the Union Debit Card at stores and online retailers including Apple, Best Buy, Wal-Mart, and Radio Shack, purchasing items for his personal benefit including electronics, music downloads, video games, cellphones, men’s clothing, gasoline, and cigarettes.  DAVIS purchased money orders using the Union Debit Card which totaled at least $30,000 from the United States Post Office in Montrose, New York.  On several occasions, DAVIS paid for rent for his residence using the money orders he purchased with the Union Debit Card.  DAVIS also used the Union Debit Card to make over 900 cash withdrawals from ATM machines in the Southern District of New York and elsewhere, in the process incurring thousands of dollars of ATM fees and fees for insufficient funds.  Between January 2008 and June 2012, the unauthorized purchases and cash withdrawals that DAVIS made with the Union Debit Card totaled in excess of $120,000.

            In order to conceal his misuse and theft of Union funds, DAVIS also made false statements and omissions in annual DOL-OLMS reports for the fiscal years 2008, 2009, 2010, and 2011, reporting a total of only $7,000 in allowances and disbursements to himself as president.

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            DAVIS, 56, of Wappingers Falls, New York, is charged with one count of wire fraud, which carries a maximum sentence of 20 years in prison, and two counts of false statements, which each carry a maximum sentence of five years in prison.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge.

            Mr. Bharara thanked and praised the DOL and the VA OIG for their work in this investigation.

            This case is being handled by the Office’s White Plains Division.  Assistant United States Attorney Jessica K. Feinstein is in charge of the prosecution.

            The charges contained in the Indictment are merely accusations and the defendant is presumed innocent unless and until proven guilty.