Grand Theft Jobs

Millions are missing at a powerful union-backed worker-training group

Feinstein brought his own bipartisan political connections to the group (in the 1980s, he endorsed both Republican Al D'Amato for Senate and Democrat Jesse Jackson for president). Originally appointed to the Metropolitan Transportation Authority by Democrat Mario Cuomo, Feinstein won a rare reappointment from Governor Pataki even after his ouster from the Teamsters for living too high off members' dues. The pro-labor CWE prospered during the Giuliani administration when it agreed to take on job-training efforts as part of the former mayor's welfare programs, establishing a so-called "one-stop" job office in Jamaica, Queens.

Immediately after the collapse of the World Trade Center, CWE executive director Joe McDermott, a former Feinstein aide at municipal workers' Local 237, gave a forceful speech to an emergency meeting of government, business, and labor leaders. McDermott urged collective action to help the estimated 100,000 workers displaced by the disaster. The resulting massive congressional funding helped CWE create 7,000 new jobs, provide aid to 300 small businesses, and train another 8,000 New Yorkers, according to a report issued last year by the group.

David Jason Fischer, who has studied training programs for the Center for an Urban Future, said CWE was a key player. "The Consortium played an important role in the city's workforce system, particularly after September 11," he said. "At the time, they were the only provider with anywhere close to the capacity and connections to meet the need. They did a lot of good in making job placements and showing that a clear system and strategy of how to provide employment services had value."

Hoodwinked: Consortium for Worker Education headquarters on Seventh Avenue
photo: Cary Conover
Hoodwinked: Consortium for Worker Education headquarters on Seventh Avenue

Although its role has diminished somewhat since the 9-11 funding was used up, CWE still claims to serve more than 100,000 workers annually. But it hasn't been without headaches. For a union-allied group, the organization has had decidedly contentious relations with the United Federation of Teachers chapter that represents its instructors. Contract talks have been bitter and protracted; teachers once even invaded the office of CWE's chief labor negotiator. In a flyer distributed to UFT members last year, the union also questioned the accuracy of CWE's financial statements, suggesting that more than $1 million was unaccounted for. Consortium officials responded that the union misunderstood the report.

Another headache was the testimony last year at the federal corruption trial of former state labor commissioner James McGowan, who was convicted of trying to steer contracts to a pal who ran a for-profit driver-training school. According to witnesses at the trial, McGowan met with CWE officials and later pushed for the Consortium to obtain a welfare-to-work contract so that it could give a subcontract to his friend's firm. The contract was never awarded, and no allegations of wrongdoing were leveled against CWE.

In scrutinizing the money trail leading to Boateng, CWE learned that its financial officer had been busy with his own side businesses. He and Madera, officials found, ran a prepaid phone card company. They also had an enterprise in which they bought junked cars and shipped them to Ghana to be repaired and sold. In New York, however, Boateng's ride was top drawer: He drove a 2003 Hummer. He is due to face a hearing this Thursday in Manhattan Supreme Court.

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