‘This misuse is shocking.’ Boilermakers union president ousted by executive staff

Tribune Content Agency

The longtime president of the Boilermakers union, with international headquarters in Kansas City, Kansas, has been ousted by his own executive council, accused of misappropriating union funds for personal use.

Newton B. Jones, who has led the International Brotherhood of Boilermakers since his father retired in 2003, was removed from office following a hearing last week. The action came after the union’s executive council found he had violated a section of the Boilermaker’s constitution dealing with the misuse of funds.

Jones was ordered to reimburse the union “all of the funds which he misspent as reflected in these charges” and to immediately resign from all of his other positions, including serving as a trustee of all funds in which the union participates.

“The drastic action of removing President Jones immediately and directing other actions is clearly necessary because of the seriousness of these allegations and the harm to our membership,” three executive committee members said in their formal document issued Thursday.

“This misuse is shocking.”

The action to remove Jones comes as a federal criminal investigation into union activities is underway, The Star has learned. Several sources confirmed that they have been interviewed by the FBI in recent weeks.

The union’s executive committee found that Jones ordered the union to pay his wife, Kateryna, more than $100,000 plus benefits “for apparently no union purpose while she was living in the Ukraine” and spent more than $20,000 in union funds for flights to Ukraine “to visit his wife and to go to the home which he owns in the Ukraine.” Jones and his wife also turned in about $40,000 in receipts for meals in North Carolina — some “quite lavish and expensive” — with no justification for the expenses.

Jones, 69, said in an email to The Star late Saturday that “it’s not what it seems” and that he would “touch base” sometime on Sunday. That didn’t happen.

The decision signed by the vice presidents on Thursday said Jones has the right under the union’s constitution to appeal the decision to the union’s next national convention. The conventions are held every five years, and the next one isn’t until July 2026.

The International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers and Helpers represents about 46,000 workers in the United States and Canada who assemble, install and repair boilers, fit pipes and build power plants and ships.

Long-standing allegations

The news about Jones’ ouster spread quickly among union members over the weekend, many who have alleged for years that he was treating union funds as his private piggy bank.

“This is a win for the rank-and-file,” said Darrell Manroe, a member of Boilermakers Local 83, based in Kansas City. “He used members’ money for personal gain. And members believe this is the tip of the iceberg.

“He’s been stripped of everything. And this was long overdue.”

Manroe, of Grand Junction, Colorado, has been a vocal critic of Jones’ leadership and ran against him for president in 2016. He announced Jones’ expulsion during a live session Friday night in a private Facebook group for Boilermakers.

Manroe told The Star that members had been questioning Jones’ handling of union funds for years, but their concerns were ignored.

“As long as I’ve been in the union, there was pretty much a ‘give it up, nothing’s going to get done’ attitude,” he said.

The Star investigated the Boilermakers in 2012, finding that Jones and other executives were living the good life. Jones’ salary and business expenses totaled more than $607,000, which put him above the presidents of the biggest unions in the country. The newspaper also found that several of Jones’ family members and relatives of other officers were earning hefty union salaries as well.

A followup story in 2017 found that little had changed. Six-figure salaries were still common for officers and their relatives, as were fine dining, stays in posh hotels and expensive hunting retreats. Cars were still given as parting gifts for retired employees, and hundreds of thousands of dollars continued to be spent on promotional events and videos — all while membership continued its downward spiral and the union’s pension fund struggled to stay afloat. And federal authorities, including the U.S. Department of Labor, had investigated the $28 million Boilermaker Vacation Plan and one of its local lodges.

The union’s most recent annual report, filed with the Labor Department for the period ending June 30, 2022, shows that Jones’ salary and disbursements for official business totaled $656,179.

Some of his relatives remain on the payroll, including his wife, who as “special assistant to the international president” received salary and disbursements of $210,369. Jones’ son, Cullen, made $115,422 as film project coordinator. And Jones’ daughter, Shea, received $113,590 as a graphic artist.

Union expenses included a $50,000 donation to the Irish Red Cross in Dublin and two $26,000 donations to the World Central Kitchen in Washington, D.C., for “Ukrainian humanitarian aid.” The union also spent $8,522 at DaVinci’s Ristorante on Marco Island in Florida and $63,048 for transportation to a labor conference in Italy. Other reported expenses: $6,489 at Ruth’s Chris Steak House in Kansas City and a $36,000 deposit to Paul Nelson Farm, a renowned hunting lodge and corporate retreat center in Gettysburg, South Dakota.

The Paul Nelson Farm website refers to the center as a “perfect balance of world-class hunting and luxury redefined.” It offers packages that include three days of hunting with private rooms, guides and dogs, ammunition, complimentary use of 12-gauge shotguns, pheasant cleaning and meals and beverages. For a group of six or more, the package runs $6,695 per person.

Executive Council takes action

According to the document signed Thursday, titled “Decision of Executive Council,” Boilermakers’ International Vice President John T. Fultz filed the charges against Jones on April 14 alleging misuse of funds.

The charges accuse Jones of violating Section 17.1.7 of the International Brotherhood of Boilermakers Constitution, which deals with “mishandling, misappropriating, or otherwise misusing Union funds or properties.”

The Boilermakers’ constitution says the executive council has jurisdiction over charges brought against international officers. The union’s executive council consists of Jones and the five international vice presidents: J. Tom Baca, Fultz, Arnie Stadnick, Timothy Simmons and Lawrence McManamon Sr. Simmons became an international vice president in February, replacing the retiring Warren Fairley.

Because Jones was the one being charged, the constitution required that he be automatically recused from participating in the proceedings and disqualified from taking any action with respect to the charges. That meant he couldn’t appoint someone to assume his role in processing the charges, the document said.

Fultz, as the person who charged Jones, also was disqualified from participating in the proceedings. After the charges were filed, the document said, the executive council reviewed them and scheduled a Zoom meeting for May 12. All five international vice presidents attended.

Jones did not appear, it said, and the council appointed Robert Lunsford, business manager for District Lodge 57 in Chattanooga, Tennessee, to replace Jones for the proceedings. Lunsford then appointed retired international vice president Joseph Maloney to be the hearing officer, the document said.

After Lunsford scheduled a hearing for May 30 in Kansas City, Jones argued that the executive council had no authority to proceed. The council acknowledged that “these are unusual circumstances” but said it had complied with the provisions of the union’s constitution.

“Any procedural defects were not substantive and were waived by President Jones’ failure to appear or respond,” the document said. “The harm to our membership warrants immediate and forceful action.”

Jones then tried to designate the union’s international secretary-treasurer, William Creeden, to serve in his role since Jones had been disqualified, the document said. But it said that because Jones had been disqualified, he could not appoint Creeden to be his replacement.

Moreover, the executive members wrote in their decision, “it also appears from the evidence presented that IST (international secretary-treasurer) Creeden approved the expenditures, which are the subject of the charges.”

“He participated and facilitated in this misuse of IBB money and would be disqualified from serving in any capacity.”

Creeden, who has been the union’s secretary-treasurer since 2005, did not respond to a request from The Star for comment.

Creeden earns $438,878 in salary and disbursements for official business, according to the union’s annual report for the year ending June 30, 2022. His son, Ryan, also works for the union, making $264,117 in salary and disbursements last year as a special assistant to the international president. Another family member, Brian Creeden, made $73,304 as a technician, the report said.

A formal hearing on the charges against Jones began at 1 p.m. on May 30. Jones and McManamon, one of the vice presidents, did not appear, the document said. Two representatives sat in for Jones and were given an opportunity to make statements on his behalf. One asked a few questions, but neither made any statements, tried to present evidence or attempted to refute the charges against Jones, according to the document.

“We received no substantive response from President Jones to explain his conduct and expenditures at these proceedings,” it said.

The charges against Jones

The first charge against Jones involved compensation to his wife, Kateryna “Kate” Jones. According to the decision, she was living in Ukraine and did not have a Social Security number or tax identification. Once she got a Social Security number, it said, Jones directed the union to retroactively pay her for about two years while she was living in Ukraine.

“There is no evidence she performed any work or did anything that would benefit the membership of the IBB,” it said. The union paid her $106,137.62, the document said, and also was liable for “very substantial benefits,” taxes and other costs.

The second charge, according to the document, was related to about $40,000 in expenses for restaurants and meals in North Carolina, where Jones lives. The receipts included meals for Jones’ wife after she moved to North Carolina.

No attempt was made at Jones’ hearing to justify the expenses, which spanned about five years, the document said.

“There is no legitimate reason and legitimate use of Union funds to pay for meals while living at home at the Union’s expense,” it said. “…This is just an abuse of members’ money and is wrong.”

A third charge was regarding flights to Ukraine by Jones and his wife that cost nearly $21,000, the document said.

“Again, there could be no conceivable use of Union funds for President Jones to fly to the Ukraine to visit his wife and to go to the home which he owns in the Ukraine,” it said. “We have no work in the Ukraine and no business there. This is a plain misuse of IBB funds.”

The executive council concluded that Jones violated the union’s constitution.

“President Jones was given the opportunity to defend himself and explain these expenditures,” the document said. “He chose not to show up. He chose to present no evidence. He chose not to send a representative to even attempt to explain these expenditures. We are left with uncontradicted evidence and no explanation.”

The council ordered Jones to be removed immediately as president and to “immediately turn over the keys, passwords, property, offices, vehicles or any property or funds of the IBB or any of its affiliates.”

“President Jones is furthermore directed to reimburse the International Brotherhood of Boilermakers all of the funds which he misspent as reflected in these Charges,” the document said.

“The IBB is directed to hire an accountant to do a forensic accounting by an independent certified public accountant experienced in auditing unions to determine the full extent of the mishandling, misappropriation and misuse of union funds and to direct that President Jones reimburse that amount after the audit is completed.”

McManamon, the only other international vice president who didn’t sign the decision (vice president Fultz wasn’t eligible to sign it because he filed the case against Jones), received $487,205 in salary and disbursements for official business in the year ending June 30, 2022. He has two children who work for union affiliates and also is a trustee on the national pension and annuity funds.

He did not respond Sunday to a request for comment.

His son, Lawrence Jr., is the Great Lakes area coordinator of the Boilermakers National Apprenticeship Program, earning $368,760 in salary and other compensation in calendar year 2021, according to IRS records.

And daughter Bridget Connors is a representative for the Boilermakers’ Mobilization, Optimization, Stabilization and Training programs, receiving $235,523 in salary and other compensation in calendar year 2020, IRS records show.

Baca, who signed the decision to remove Jones, also has had family members on the union payroll, according to its annual report for the period ending June 30, 2022.

His son, John Baca, earned $248,156 in salary and allowances as a marketing manager for the union, the document says. And Tom Baca’s wife, Heather, made $81,194 in salary and other disbursements as an administrative secretary.