Seven indicted, two from Kansas City area in Boilermakers Union scheme

KANSAS CITY, Mo. — Seven current and former high-level officers of the International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmith, Forgers and Helpers ( Boilermakers Union ) have been charged by a federal grand jury. Two of the seven men are from the Kansas City area.

The two men from the area are former secretary-treasurer William Creeden, 76, of Kearney and current secretary-treasurer Kathy Stapp, 53, of Shawnee. Four other defendants are from Chapel Hill, South Carolina and one is from Rocky River, Ohio.

Court documents say that the defendants are charged with conspiracy to commit offenses under the Racketeer Influenced and Corrupt Organizations ( RICO ) Act for their accused roles in a 15-year, $20 million embezzlement scheme. The defendants are also being charged on other charges like health care fraud, wire fraud and theft in connection with health care and retirement plans.

“As alleged in the indictment, these defendants, including two former presidents of the Boilermakers Union, enriched themselves by spending millions of dollars in union funds for their own benefit, including for salary and benefits for no-show jobs, tuition, rent, luxury international travel, meals, vacation payouts and unauthorized loans,” said Principal Deputy Assistant Attorney General Nicole M. Argentieri, head of the Justice Department’s Criminal Division.

“This indictment marks an important step in restoring financial security to the Boilermakers Union and control of the union’s future to its membership. The department is committed to protecting union members from officials who abuse their positions of authority for their own personal ends.”

According to court documents, over the course of the 15-year scheme, the defendants were led by Creeden and one other defendant from Chapel Hill. Records show that the defendants are accused of embezzlement of the funds of the Boilermakers Union including:

• Over $5 million in unnecessary luxury international travel.
• Over $2 million in salary and benefits for two workers for no-show jobs. This includes a two-year salary for one person who wasn’t living in the U.S. during the time.
• Hundreds of thousands of dollars in tuition, rent and relocation expenses for family members.
• Millions of dollars in cash payments relating to fraudulently claimed vacation time.
• Hundreds of fraudulent restaurant charges.
• Funds wrongly expended to engage in email surveillance of Union employees.
• $7 million in loans from the Boilermakers Union MORE Fund.

The indictment also charges Creeden and an associate with wire fraud relating to their acceptance of no-show employment with the Bank of Labor for which they were paid more than $3.4 million each in salary and benefits. Additionally, $20 million is being sought in forfeiture.

If convicted, the defendants will face a max sentence of 20 years in prison on the RICO conspiracy count.

The FBI Kansas City Field Office and the Department of Labor are investigating the case.

Trial Attorney Vincent Falvo of the Criminal Division’s Violent Crime and Racketeering Section and Assistant U.S. Attorneys Faiza Alhambra and Jabari Wamble for the District of Kansas are prosecuting the case.

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