Former UAW official pleads guilty in conspiracy

Detroit — Nancy Adams Johnson, a former high-ranking United Auto Workers official charged in a widening corruption scandal involving Fiat Chrysler Automobiles NV, pleaded guilty Monday and faces up to 18 months in federal prison.

Adams Johnson, 57, of Macomb Township, the union’s No. 2 official at Fiat Chrysler, told U.S. District Judge Paul Borman she violated a federal law prohibiting labor officials from receiving cash and valuable items from employers. In this case, she received tens of thousands of dollars in illegal payments and benefits from Fiat Chrysler during the conspiracy, including $1,100 designer shoes, first-class flights to California, resort stays and limousine rides, according to federal prosecutors.

The plea came four months after Adams Johnson was indicted and accused of conspiring with other union and Fiat Chrysler officials to corrupt the labor negotiation process. The conspiracy clouded the final year in office of Fiat Chrysler CEO Sergio Marchionne, who stepped down Saturday due to health problems.

Marchionne has been questioned by investigators amid the widening investigation. He is represented by a white-collar criminal defense lawyer, William Jeffress of the Washington, D.C., law firm Baker Botts.

“Today’s conviction of yet another senior UAW official further exposes the dishonorable scheme between UAW officials and Fiat Chrysler executives to corrupt the collective bargaining process at the expense of rank and file union members,” U.S. Attorney Matthew Schneider said in a statement. “The conviction reveals that part of this scheme involved the wrongful use of UAW funds for extravagant meals, entertainment, golf, and travel for little, if any, union-business purpose.”

Adams Johnson's guilty plea could mean trouble for more union and Fiat Chrysler officials because she has agreed to cooperate with federal investigators in the ongoing probe, which has spread to General Motors Co. and Ford Motor Co.

She will be sentenced Nov. 19 and could be forced to pay an undetermined amount of restitution.

Adams Johnson and defense lawyer Harold Gurewitz declined comment while leaving federal court in Detroit.

She is the seventh person to plead guilty in the widening scandal.

The five-count indictment against Adams Johnson shed light on what prosecutors describe as a pattern of Fiat Chrysler officials funneling illegal payments to UAW labor leaders through a joint training center. The case already has ensnared former Fiat Chrysler executive Alphons Iacobelli and Monica-Morgan Holiefield, the widow of former UAW Vice President General Holiefield.

The government’s 18-page indictment featured new details about an alleged conspiracy that continued after Holiefield retired in June 2014 and chronicled crimes that continued during the leadership of his successor, UAW Vice President Norwood Jewell. The conspiracy described by prosecutors raises questions about the sanctity of labor contracts negotiated between the UAW and Fiat Chrysler.

Adams Johnson, a member of UAW-Chrysler National Training Center board, was Jewell’s top administrative assistant and they served on the 2015 national committee that negotiated the contract with Fiat Chrysler. At least three UAW officials on the committee have either been charged or linked to the investigation, and that figure could climb, The News has learned.

The illegal benefits came from Iacobelli, who is awaiting a federal prison sentence, and former Fiat Chrysler analyst Jerome Durden, who also has pleaded guilty. Other Fiat Chrysler executives involved in the alleged conspiracy are not identified in the indictment.

Adams Johnson traveled, golfed, dined and shopped with Fiat Chrysler money funneled through the training center under a policy created by the auto company’s officials to keep UAW leaders “fat, dumb and happy,” according to the government. The policy was designed to wring concessions favoring the automaker, according to the government.

Adams Johnson was charged seven months after The Detroit News first linked her and Jewell to the corruption investigation. Sources described Adams Johnson as one of the more egregious abusers of the training center’s credit cards, saying she charged more than $75,000 from 2014 to 2016 for personal items, including clothes, jewelry, luggage and meals.

She was charged in the indictment with conspiracy to violate the Labor Management Relations Act and four counts of receiving and accepting prohibited money and things of value from a union employer. Both are five-year felonies.

UAW spokesman Brian Rothenberg said Monday that the criminal conduct did not impact collective bargaining agreements.

“The misconduct by Nancy Johnson and certain other individuals in this case has been very disturbing," Rothenberg said in a statement. "The UAW has taken strong measures to prevent a reoccurrence of this type of misconduct and our new leadership team continues to oversee improvements in our operations and financial controls. We will continue to review the facts and take additional actions as warranted."

The illegal payments and benefits flagged by federal investigators were from 2014 and 2015. They include:

■$6,912 at the London Chop House.

■$6,678 on flights between Detroit and California.

■$4,587 spent at LG’s Prime Steakhouse in Palm Springs, California.

■$1,259 for luggage.

■$1,652 at Cardliff Limousine in Palm Springs.

■More than $1,800 at Indian Canyons Golf Resort in Palm Springs.

■More than $1,800 at St. John Knits and other retail stores in and around Palm Springs.

■More than $6,900 at the Renaissance Resort & Spa in Palm Springs.

■$1,217 at Salon Bilal in Pasadena, California.

■$1,160 for a pair of Christian Louboutin shoes at Neiman Marcus.

■More than $1,700 for a set of graphite women’s golf clubs and a diva cart bag.

■More than $1,000 at Divalicious and other retail stores in Orlando, Florida, and Clinton Township.

In all, Adams Johnson’s flights and shopping sprees cost more than $33,000, according to the government.

Adams Johnson also was linked to a $2,180 Italian-made Beretta shotgun purchased with training center funds for Jewell as a birthday present in 2015. She told former UAW official Virdell King to buy the shotgun with her training center credit card, according to the indictment.

rsnell@detroitnews.com

(313) 222-2486

Twitter: @robertsnellnews