i L i n d . n e t

As far as I can tell, KITV was the only one to report this week that former union leader Gary Rodrigues has been order to begin serving his sentence of 64 months in prison after exhausting all appeals. Judge David Ezra rejected a request to reduce the sentence to 33 months and to allow extended payment of restitution at $1,000 a month rather than in a lump sum.

And even the KITV report glossed over the final stages of this legal drama and provided none of the details.

Rodrigues San Francisco-based attorney, Doron Weinberg, sought a reduction in his sentence arguing that Rodrigues’ life was one of service to his union and to the community. Weinberg recited his history with the union, then painted the former UPW head as first and foremost a family man. I suppose this is “the family made me do it” defense.

Indeed, it was his devotion to his family that impelled Defendant to make the error of judgment which led him to commit these offenses. He saw – but apparently misperceived – an opportunity to assist members of his family financially. The record is clear that he himself did not seek or gain any benefit from the money received by his daughter, some of which was used to benefit other members of the family.

In assessing the circumstances of the offense, it is important to bear in mind that Defendant’s motivation was to help his family and he believed he was doing so not at the expense of his union, but based on voluntary payments from insurance carriers. It is also significant that, as this Court found, he made no false statements or representations in order to obtain this financial benefit for his family. Rather, he deprived the union of his honest services by directing the financial opportunity to his family, rather than the union.

I have to say that this is the first time that I can recall Rodrigues or his attorney admitting to having done something wrong, albeit while trying to minimize the offense.

The government argued in response that Rodrigues used his long history with the union, and his knowledge of and control over its internal affairs, for the personal gain of himself and his family.

…Defendant Rodrigues began his long tenure as State Director with good intentions, having the best interests of
the union and its members as his priority. Over the years, he became greedy, autocratic, vindictive and tyrannical in the way he conducted himself and ran the day-to-day operations of the UPW. He clearly abused a position of trust placed in him by the more than 12,000 members of UPW, in a manner which continued for a long time, and which was carefully crafted to avoid getting caught, while lining his pockets, and that of his daughter, with hundreds of thousands of dollars.

Further:

Defendant Rodrigues betrayed the trust he earned by using certain of that information and knowledge, in a
criminal manner, to his own benefit, in total violation of the trust placed in him by the members of the United Public Workers.

Finally, Ezra issued an 11-page order affirming the original sentence and ordering Rodrigues to surrender to federal prison authorities on January 7. Ezra noted that the original sentence was bumped up due to several factors:

Defendant’s base level offense was 20 for his money laundering convictions. This Court adjusted the level upward by three levels based on the amount of money involved, another two levels for abuse of a position of trust, and two more levels for obstruction of justice. The total offense level was therefore 27, with a corresponding sentencing range of 70 to 87 months. Defendant was sentenced below that range, to 64 months.

In any case, the bottom line is that Rodrigues will finally be heading to prison in January, absent an appeal of Ezra’s sentencing decision (are such appeals possible?). And Weinberg, Rodrigues’ defense attorney, will be heading into the headlies as the new lead defense attorney in the retrial of Phil Spector.

I would actually feel sorry for Rodrigues if it appeared that he ever really acknowledged his mistakes and felt any remorse, but I don’t think that’s ever happened.

What’s worse, the broader labor movement never owned up to its responsibility for letting this situation go on unchallenged, although other union leaders certainly knew of at least some of the illegal arrangements and in at least one case facilitated continued payments to Rodrigues’ daughter after they were first challenged. And, as far as we know, no other union called for an examination of its own contract arrangements to make certain similar kickbacks aren’t being paid. That failure, in the long run, certainly has contributed to public cynicism towards government unions here, in my view a most unfortunate outcome.

Of course, this case has special importance to me because it followed my series of investigative stories about Rodrigues, an investigative path that others never did follow. And the story of his indictment in March 2001 was my last story written for the Star-Bulletin.

I didn’t start off investigating Rodrigues. Instead, I had been interested in HMSA and other so-called “mutual benefit societies” that dominate Hawaii’s health insurance industry. It was ten years ago, at the end of 1997, that I decided to check out the court files of the state insurance commissioner’s probe into the collapse of PGMA, a relative newcomer in the mutual benefit world, that had been taken over by regulators at the beginning of that year. Business reporters had covered several of the hearings, but I wanted to check the court records for further details.

And those court records, largely boring, turned out to contain a couple of instant bombshells. First, the insurance commissioner asserted that fraud had been involved in the PGMA case, something that had not been previously reported by the business desks. Then, digging through subpoenaes issued for the company’s bank accounts and those of its president, there was a subpoena for records of a company with an interesting but unknown name: Four Winds RSK. It was only when I checked business registration records for this company that I found it was formed by Rodrigues daughter on Kauai. It took a while to connect the dots, but I finally got an initial story into print in January 1998. The rest of the series, and the Rodrigues indictments, followed.

On a different note, this was the our dinner table on Thursday evening. It’s my version of a turkey stew. It has to simmer for a while, as long as a couple of hours, but doesn’t involve any heavy lifting and ends up as a fine feast. Just click on the photo for more details.