Chicago Sun Times

Ex-Union Boss Granted Immunity


November 27, 1998

One of the most controversial and powerful union bosses in the nation, accused of a litany of financial abuses, quietly received immunity from prosecution from top Justice Department officials in Washington, the Chicago Sun-Times has learned. The deal virtually ensures thatChicagoan Edward T. Hanley Sr., who reigned for 25 years over the Hotel Employees and Restaurant Employees International Union, won't ever be investigated by the government for alleged financial abuses disclosed two months ago, according to law enforcement sources and others familiar with the case.

Hanley was forced out of the union earlier this year. A federal monitor overseeing the union turned up the alleged abuses after a 2 1/2-year investigation, painting Hanley as reigning like a monarch. The investigation found that dues from some of the lowest-paid union workers in the country went for a $3 million jet used by Hanley's family, a fleet of Cadillacs for union bosses and a $100,000 motor home parked near Hanley's house.

Allegations against Hanley include:

* Even though he was general president of the international union, he had what amounted to a $31,000-a-year ``no-show'' job at the Chicago local union run by his son.

* His international union approved creation of an alleged ``ghost'' union local in Rhinelander, Wis., near Hanley's vacation home.

* Under Hanley, the union maintained a fleet of leased vehicles costing more than $500,000 a year. The vehicles--many of them Cadillacs--were used by officials who had no apparent duties and top union bosses and their family members, including Hanley's wife.

* Some of those leases were ``front-loaded'' with steep payments footed by the union so officials could buy their cars on the cheap once the union leases expired. Hanley repaid the union almost $14,000 because of such deals but did not admit any wrongdoing.

Sources familiar with the immunity deal said it protects Hanley from prosecution on those alleged abuses and would make it difficult to pursue almost any investigation stemming from Hanley's tenure.

A Justice Department spokesman in Washington declined to comment on the decision to grant immunity to Hanley. The department also rejected a request from the Sun-Times under the Freedom of Information Act for a copy of the immunity letter.

According to sources familiar with the case, Hanley's quest for immunity began earlier this year after he secretly agreed to leave the union post. His departure agreement, signed in late February, came only after the federal monitor in the case threatened to file civil charges against him. A federal judge sealed the agreement until Hanley announced his ``retirement'' in May.

Shortly after the departure deal was hammered out, sources said, Hanley's lawyers learned of a federal criminal investigation into allegations that Hanley's international ran the ``ghost'' local in Wisconsin. An official affiliated with that union received what is known as a ``target letter'' from authorities, sources said.

Hanley's lawyers were stunned, sources said. They believed investigations would not be pursued once Hanley agreed to step down, according to sources.

The lawyers then threatened to pull out of the departure agreement with the monitor's office unless Hanley received immunity, sources said. The monitor was set up in 1995 under a court-approved deal between the Justice Department and his union.

Before deciding to grant Hanley immunity, sources said, the Justice Department in Washington gave federal prosecutors in Chicago only two weeks to determine whether they could make a criminal case against Hanley. That made the task for U.S. Attorney Scott Lassar's office almost impossible given the volume of evidence gathered by the monitor and the FBI during their probe, according to sources familiar with the case.

A spokesman for Lassar declined to comment. John Cassidy, a Washington lawyer who represented Hanley in dealings with the Justice Department, also declined comment, as did Kurt Muellenberg, the federal monitor.

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