FCA, U.S. in talks to settle training center criminal case

June 19, 2019 11:34 AM UPDATED 18 HOURS AGO
FCA, U.S. in talks to settle training center criminal case

DETROIT — Fiat Chrysler Automobiles is negotiating a settlement with the U.S. Department of Justice to resolve a federal corruption investigation into the UAW-Chrysler National Training Center, according to an FCA filing.

The probe has led to charges of tax fraud and other crimes against former FCA US employees and people associated with the UAW.

“We continue to cooperate with this investigation and are in discussions with the DOJ about a potential resolution of its investigation,” FCA’s May 3 filing with the U.S. Securities and Exchange Commission said. “The outcome of those discussions is uncertain; however, any resolution may involve the payment of penalties and other sanctions.”

“At this time, we cannot predict whether or when any settlements may be reached or, if no settlement is reached, the ultimate outcome of any litigation. As such, we are unable to reliably evaluate the likelihood that a loss will be incurred or estimate a range of possible loss.”

In addition to tax fraud, the investigation has led to charges of conspiracy to provide money or other things of value to a UAW officer and UAW employees while acting in the interests of FCA US, in violation of federal labor laws.

The Detroit News first reported Wednesday that the negotiations “are focused on Fiat Chrysler submitting to government oversight for up to five years, paying less than $50 million in penalties and agreeing to make broad institutional changes to emerge from a bribery scandal that has led to eight convictions, including former FCA Vice President Alphons Iacobelli.” The News reported that “negotiations continue, and one sticking point is whether Fiat Chrysler agrees to admit guilt.”

FCA declined to comment on the status of the negotiations Wednesday.

One of the charged individuals is former UAW Vice President Norwood Jewell. Federal prosecutors charged Jewell in March with one count of conspiracy to violate the Labor Management Relations Act for receiving more than $40,000 worth of travel, lodging and meals from people acting on behalf of FCA from at least 2014 to 2016.

Jewell pleaded guilty to the charge in April in U.S. District Court in Detroit. He is to be sentenced Aug. 5.

The UAW paid roughly $218,000 in legal fees last year for Jewell, despite his retirement at the end of 2017.

Jewell began leading the union’s FCA Department in June 2014, following the retirement of General Holiefield, who died in March 2015 and led the department from June 2006 to June 2014. Federal prosecutors have painted Holiefield and his wife, Monica Morgan, as key figures in the scandal.

“I own the fact that we did not apportion costs appropriately and that’s why I’m standing here today,” Jewell said during his April hearing.

Michael Wayland contributed to this report.

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