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Most of the funds are professionally administered and honestly run, yielding many truckers up to $550 a month after 20 years' service. Where the trouble —and the Mafia—comes in is with the huge (estimated assets: $1.5 billion to $2 billion) Central States, Southeast and Southwest Areas Pension Fund, based in Chicago. The target of many federal probes over the years, the Central States fund is characterized by a federal investigation as nothing less than a lending agency for the Mob.
Friendship Loans. Numbingly complex, with its funds shifting continually between banks and from one business to another, Central States makes legitimate loans to legitimate borrowers, but it also makes other loans mainly on the basis of friendship. All too frequently, says a U.S. Attorney in Chicago, the loans are not paid back, and no real effort is made to collect, especially if the borrower is a pal of a top Teamster official.
Officially, the fund is administered by eight Teamster officers and eight employer representatives. Four of the Teamsters' trustees have known connections with the Mafia: Frank Fitzsimmons, William Presser, Frank Ranney and Roy Williams. In practice, say federal investigators, just who gets money is determined by the union trustees; they are influenced heavily by Allen Dorfman, once a special consultant to the fund until he was convicted of accepting a $55,000 kickback from a borrower and went to prison for eight months. He was forced to sever his Teamster connections, but he still calls many shots.
Central States has $783.5 million outstanding in real estate loans and mortgages alone. The money has gone into the building of bowling alleys, apartments, factories and lavish resorts, such as La Costa, near San Diego, into which the fund has put an estimated $50 million. According to the San Diego Union, a $270,000 house was built there for Fitzsimmons. Fitzsimmons says he is "only thinking about buying it."
Missing Money. A lot of the fund's money, too, has gone into Las Vegas hotels and gambling casinos, such as the Dunes and Caesars Palace. Some of it has simply vanished. The Government has brought fraud and conspiracy charges against borrowers and trustees alike. Last year prosecutors secured an indictment against Irwin Weiner, a Chicago bail bondsman with Mob connections, for allegedly defrauding the fund of $1.4 million in a scheme to buy a plastics plant in New Mexico. As the case was about to go to trial, the Government's star witness was shotgunned to death before his wife and children. The prosecution pressed ahead anyway, but Weiner was acquitted.
Teamster ties with the Mafia go way back. Nicholas P. Morrissey, secretary-treasurer of Teamsters Joint Council 10 in Boston, observes, "Most people who come out of prison go into this kind of work [trucking, warehousing and longshoring]." Hoffa had friends in the Mob and indeed used them in his climb from the boss of Detroit's Local 299 to his election as the union's president in 1957. But Hoffa always retained a degree of independence of the gangsters.