Saturday, June 30, 2012

Tyrone Freeman’s Wife Pleads Guilty in Connection with SEIU Corruption Scandal

Court records reveal that Tyrone Freeman’s wife -- Pilar Planells -- has pleaded guilty to tax evasion charges connected to the massive corruption scandal that rocked SEIU in 2008.

This morning, the Los Angeles Times published this article -- Wife of ex-SEIU Local Chief Pleads Guilty to Income Tax Charge -- describing these latest developments. Here’s how the LA Times described it:
Pilar Planells, wife of ousted SEIU local president Tyrone Freeman, pleads guilty in connection with more than $540,000 she received in consulting payments from the L.A.-based labor organization.
Freeman is a close ally of SEIU President Emeritus Andy Stern and other top union officials, who appointed him to be the president of Local 6434. In a series of articles published in 2008 and 2009, the Los Angeles Times described how Freeman was stealing millions of dollars from low-wage homecare workers who earn only $9 per hour. Freeman funneled some of these ill-gotten gains to his wife and mother-in-law.

For example, in 2008, SEIU Local 6434 paid more than $540,000 in “consulting fees” to Lotus Seven Productions, a video production company that Planells set up and supposedly ran out of the house where she and Tyrone Freeman lived. Planells never paid taxes on the more than half-million dollars of consulting fees. That’s the basis of the tax evasion charges against her.

According to court records (which Tasty has posted below), the feds were also considering a variety of other criminal charges against Planells, including:
mail fraud, wire fraud, conspiracy to commit mail or wire fraud, [and] conspiracy to embezzle or steal from a labor organization arising out of defendant’s conduct in obtaining money from SEIU Local 6434 through contracts with Lotus Seven Productions, Inc. and with Planells Family Child Care. (pp. 5-6)
However, in exchange for Planells’s guilty plea on tax evasion, the feds dropped these other charges and agreed to recommend a lighter sentence for Planells: three years of probation and payment of $130,000 in back taxes, penalties and interest. Sentencing will reportedly take place next month.

So what about the feds’ investigation of SEIU’s Tyrone Freeman? Here’s what the LA Times said today:
"It's a very active case," said a person close to the inquiry, who requested anonymity because of the sensitive nature of the matter.
In fact, court records indicate that the feds may finally be preparing to take action against Freeman. And if the feds were prepared to charge Planells with “conspiracy to embezzle or steal from a labor organization,” it seems that the same charge will end up on Freeman's court docket, among others. Meanwhile, a source sent Tasty some additional records that indicate Freeman’s corruption was far greater than previously reported. Tasty will spell out the details in a future post.

These latest developments offer still more vindication of Sal Rosselli and the former Executive Board of SEIU-UHW. Back in 2008, they criticized the corruption inside SEIU and proposed a series of reforms. But instead of addressing the problems, Andy Stern teamed up with Tyrone Freeman to launch a multi-million-dollar attack campaign against his internal critics. In early 2009, Andy Stern and Mary Kay Henry famously ordered SEIU-UHW to transfer 60,000 of its members to SEIU Local 6434, which was basically a giant crime scene. And if that wasn’t crazy enough, the SEIU officials then imposed a disastrous trusteeship on SEIU-UHW after the local's Executive Board insisted that SEIU-UHW's members should have a right to a democratic vote before being transferred to Local 6434.  

More details about Freeman's corruption will certainly emerge when the feds finally take action, including the role that SEIU's Steve Trossman performed in staging a cover-up of Freeman's corruption back in 2001, which allowed Freeman to go on stealing for another seven years. 

Finally, does Planells's plea deal force her to testify against Freeman? According to the LA Times,
Planells' attorney, Stephen Larson, said his client has not promised to testify against anyone as part of the deal.
Here's the plea deal: