Troubles run deep for key labor union in D.C.

The Laborers' International Union has in its legislative affairs office a lobbyist who pleaded guilty in a fraud case despite a federal law banning convicts from overseeing unions’ finances.

The troubled union also was hit this month with a tax lien from the District of Columbia, which charged that it owes nearly a half-million dollars in unpaid taxes dating back eight years.

According to a former employee, the workers at the nepotism-besieged headquarters felt so mistreated that receptionists and others tried to unionize under the AFL-CIO, only to have the Laborers' Union headquarters engage in union busting.

Tax arrears

The District’s Office of Tax and Revenue issued a tax lien Jan. 9 against the union’s Connecticut Avenue Northwest headquarters in the amount of $460,736 for unincorporated franchise taxes, penalties and interest on 2004, 2006, 2009 and 2010 taxes, records obtained by The Washington Times show.

“Prevent seizure action by sending full payment today!” the letter says.

The union’s previous headquarters, on Vermont Avenue Northwest, had federal tax liens issued against it in 1991 and 1992 for $70,000 and in 1993 for $25,000, records show. They were settled in 1995 and 1996.

The union has been quick to criticize others for not paying taxes, telling members last year that Republican presidential nominee Mitt Romney “opposes legislation that would ensure corporations pay their fair share of taxes — even though the largest corporations in the U.S. pay no taxes.” The group also slammed Mr. Romney personally for having paid a low effective tax rate of 13.9 percent in 2010.

The Laborers did not respond to requests for comment.

Office of Tax and Revenuespokeswoman Natalie Wilson confirmed that “the lien as filed is accurate.”

Fraudster in charge

The 2011 tax form filed by a union-affiliated trust fund shows Leo J. Gannon employed as head of legislative affairs, making $144,000 from the trust itself plus $64,000 from “related organizations.”

In 2003, however, Mr. Gannon pleaded guilty in federal court to a charge of making false statements to federal investigators. Mr. Gannon remained head of legislative affairs for the Laborers-Employers Cooperation and Education Trust despite his plea.

Mr. Gannon initially was charged with four felony counts of wire fraud and making false statements but pleaded guilty to one lesser count of false statements after prosecutors could not show that wires were used in the commission of fraud and offered him the chance to plead to a charge carrying a far lower penalty. He received probation and a fine.

But even as he faced federal prison, Mr. Gannon continued to carry out Laborers business, asking the judge for permission to leave the District to attend a transportation conference in Florida at the Wyndham Orlando Resort and for trips to Quebec, Hawaii and the Foxwoods Resort Casino in Connecticut, according to court documents.

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