As FBI Probes Possible SEIU Corruption, FEC Shockingly Gives SEIU a Free Pass

On the same day that it is revealed that the FBI is investigating potential wrongdoing from former SEIU president Andy Stern’s lucrative book deal, the Federal Election Commission has dismissed a complaint of election law violations, overruling even its own general counsel.


On Tuesday, the Los Angeles Times reported that ex-SEIU boss Andy Stern is the subject of an ongoing investigation by the U.S. Department of Labor and Federal Bureau of Investigations:

The FBI and the Labor Department are investigating prominent labor leader Andy Stern in a probe of corruption at the Service Employees International Union, according to two people who have been interviewed by federal agents.

The two organized labor officials met with federal agents this summer to answer questions about a six-figure book contract that Stern landed in 2006 and his role in approving money to pay the salary of Alejandro Stephens, a former SEIU leader in California who allegedly performed no work. The title of the book is “A Country That Works.”

The union official Stern allegedly paid for “no show” job, Alejandro Stephens was, according to the Times, fired from his government job in early 2009 for refusing to return to work following an extended paid leave arranged by his ex-girlfriend (another high-ranking SEIU official), Annelle Grajeda.

Grajeda, who also is one of the SEIU’s highest-ranking national officers, went on leave in August after the union opened an inquiry into whether she abused her position by helping Stephens, a county healthcare marketing representative, remain on the public payroll. She is still on leave, and the internal investigation is continuing, an SEIU spokeswoman said.

Stephens, who could not be reached for comment, has appealed his firing through Grajeda’s SEIU chapter, Local 721, which represents about 80,000 social workers, nurses, sanitation drivers and other government workers. A civil service hearing is pending.

The firing took effect in December, after the county Health Services Department accused Stephens of insubordination for not reporting to work in September. Stephens had been on an eight-month leave for which the local had reimbursed the county, according to the union.


In March 2009, Annelle Grajeda resigned her post with the SEIU.  Later, in September 2009, after pleading guilty to three federal charges, Stephens was sentenced to four months in prison and three months of home confinement for his role in defrauding a non-profit out of $52,000.

On Tuesday afternoon, in response to the LA Times and AP stories, Stern denied that he is the subject of an investigation.

“”The stories appearing today in the L.A. Times and the on AP are simply false. I have absolutely no reason to believe, and not the slightest indication, that I am being investigated by federal authorities with respect to Alejandro Stephens, or A Country That Works, or for that matter anything else,” he said.

Interestingly, although Stern was paid a $175,000 advance for his book, according to Politico’s Ben Smith, the book did not sell enough copies for the publisher to earn back its advance.

Whether or not the FBI or the Labor Department turns anything up on Stern (doubtful in the latter’s case since Stern and the SEIU pushed heavily for Hilda Solis’s confirmation as President Obama’s Secretary of Labor), the more intriguing story is the “mysterious” way in which the Federal Election Commission dismissed a complaint against the SEIU.

Fox News reports that the Federal Election Commission, even overruling its own general counsel, dismissed a complaint filed against the SEIU alleging that the purple union violated election laws.


Despite a finding by the Federal Election Commission’s (FEC) general counsel that the Service Employees International Union (SEIU) violated election law when it required local affiliates to contribute to its political action fund, the FEC’s full board nonetheless quietly voted to overrule its staff attorney and dismissed the original complaint, reported Tuesday.

Moreover, the group that filed the complaint, the National Right to Work Foundation (NRWF), did not receive a full explanation of the FEC’s decision in the case until after 111 days had passed, ensuring that its right to file an appeal had lapsed.

“They can’t do that,” said foundation president Mark Mix, who is vowing to challenge the commission’s actions. “We will pursue the appeals process. We are working on it now.”

He added he is prepared to file a new complaint, if necessary.

No one at the FEC “will speak in reference to this case,” FEC spokeswoman Julia Queen told Fox News.

Queen defended the FEC’s actions, and said it was the Right to Work Foundation’s responsibility to file its appeal immediately after it received the one-page letter of dismissal — called a “Letter of Reasoning” — which is usually issued within 30 days of the decision and explains the basis for any decision.

But Bruce Cameron, the NRWF attorney who brought the case, said Queen’s explanation does not make sense.

To bring an appeal I have to show that the FEC abused its discretion. I can’t do that with a simple dismissal letter,” he said, adding that the FEC’s logic in granting the dismissal made little sense. “They created a mystical distinction between the union and its membership that makes no sense,” he said.


So, as the FBI and the Obama Labor Department may or may not be investigating Andy Stern, and while all sorts of shenanigans appear to be occurring around the country, the FEC sneakily dismisses a complaint against the SEIU, then waits until the time for appealing had lapsed before issuing its full decision.

One interesting side note for the NRTF attorneys to look into is whether the FEC’s dismissal, which presumably gives the SEIU International the right to demand its locals to contribute to its political action fund establishes the clear controlling relationship that the SEIU has over its locals.

If so, then former SEIU general counsel (and current NLRB interim member) Craig Becker’s ethically-challenged argument that the SEIU and its locals are “separate and distinct” has one more flaw.

“I bring reason to your ears, and, in language as plain as ABC, hold up truth to your eyes.”Thomas Paine, December 23, 1776


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