Three Leaders of Local 348-S of United Food and Commercial Workers International Union Sentenced in Manhattan Federal Court

Preet Bharara, the United States Attorney for the Southern District of New York, announced that ANTHONY FAZIO SR., ANTHONY FAZIO JR., and JOHN FAZIO JR., (collectively, the “FAZIOs”), longtime leaders of Local 348-S of the United Food and Commercial Workers International Union, were sentenced today by U.S. District Judge Katherine B. Forrest to 151 months, five years, and 135 months in prison, respectively, in connection with racketeering, extortion, money laundering, and witness tampering charges. All three defendants were convicted in Manhattan federal court in May 2012 after a three-week jury trial.

Manhattan U.S. Attorney Preet Bharara said: “For decades, the Fazios sold out their union members, and got rich off the backs of the working men and women they were supposed to represent. The sentences imposed today ensure that the Fazios will disgorge their millions of dollars in ill-gotten gains and spend a substantial period of time in prison paying for their crimes.”

According to the superseding indictment filed in Manhattan federal court, other court documents, the evidence presented at trial, and statements made during related court proceedings:

The United Food and Commercial Workers International Union (the “UFCW”) is a national labor union that represents workers in many industries, including agriculture, health care, meatpacking, poultry and food processing, manufacturing, textile, and retail sales. With approximately 12,000 members, Local 348-S of the UFCW (“Local 348” or the “Union”) is the largest of the 12 constituent locals of the UFCW in New York City.

For the past 35 years, the FAZIOs have maintained top leadership positions at Local 348. ANTHONY FAZIO, SR. (“FAZIO SR”) was the president of Local 348 from 1976 to January 2010, followed by ANTHONY FAZIO, JR. (“FAZIO JR.”), who held the position from January 2010 through February 2011. JOHN FAZIO, JR. (“JOHN FAZIO”) was the vice president of the Union from September 2000 until January 2010.

From 1989 until 2011, the FAZIOs used their leadership positions to collect unlawful payments from various employers whose employees had been unionized by the UFCW. The FAZIOs utilized the threat of possible labor disruptions and other means to extort annual or biannual cash payments from at least 12 employers and an administrator who handled and processed medical reimbursement claims on behalf of Local 348’s Health and Welfare Benefit Funds. The FAZIOs personally collected these secret cash payments from employers and the fund administrator. At least one employer was extorted by as much as approximately $25,000 per year by the FAZIOs, and the fund administrator was extorted by as much as $7,000 every month by the FAZIOs.

In addition, FAZIO SR. and JOHN FAZIO engaged in a money laundering scheme to steal funds directly from Local 348 and its affiliated Benefit Funds. Among other things, they concocted a scheme whereby Local 348 was billed using fraudulent invoices for non-existent goods and services. The Local 348 funds used to pay those bogus invoices subsequently were laundered into cash and siphoned back to FAZIO SR. and JOHN FAZIO.

Over the time period set forth in the superseding indictment, the FAZIOs extorted or stole well over $2,500,000 from the Union, Local 348’s Benefit Funds, and employers whose employees belonged to the Union.

FAZIO SR. was also convicted of one count of witness tampering by attempting to persuade an individual to commit perjury before a federal grand jury in connection with the investigation of this case.

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In addition to the prison terms, Judge Forrest sentenced the defendants to the following:

• FAZIO SR., 66, of Brooklyn, New York, was sentenced to three years of supervised release, and ordered to pay a $1.5 million fine and a $600 special assessment fee;
• FAZIO JR., 37, of Brooklyn, New York, was sentenced to three years of supervised release, and ordered to pay a $100,000 fine and a $400 special assessment fee; and
• JOHN FAZIO JR., 40, of Staten Island, New York, was sentenced to three years of supervised release, and ordered to pay a $1.5 million fine and a $500 special assessment fee.

All three defendants will also be held joint and severally liable for $2.5 million in restitution and forfeiture.

In sentencing the FAZIOs, Judge Forrest said the defendants “engaged in conduct that was brazen, egregious, and occurred over a number of years,” that they “got rich off the backs of workers,” and “left behind...a large number of victims.”

Mr. Bharara praised the investigative work of the Federal Bureau of Investigation and the Department of Labor.

The case is being handled by the Office’s Organized Crime Unit. Assistant U.S. Attorneys Chi T. Steve Kwok, Peter M. Skinner, and Brian R. Blais are in charge of the prosecution.