One of the longest running embezzlement scams in the industry’s history has ended. The scam spread across several different trucking companies and has cost employees an excess of $5 million since 2007. All of the companies were owned by one man, Nicholas Farnsworth, who recently admitted to crimes including embezzlement, unlawful payments, and health care fraud.
According to a press release issued by the U.S. District Attorney’s office for the Eastern District of New York, Farnsworth owned several different trucking companies using nominal owners. The companies entered into an agreement with the Teamsters Union in 2007 which “obligated the defendants to pay specific hourly wages to their drivers and to make payments to Local 282’s welfare, pension, annuity, job training, and vacation and sick leave trust funds.”
From 2007 until 2011, Farnsworth’s companies illegally contracted their union work out to non-union trucking companies including Rainbow Transport Corp. So since the work was being done by non-union drivers, Fansworth and four others were able to pocket the cash that was meant for union benefits.
“As charged in the indictment, in these difficult economic times these defendants conspired to steal the pension and welfare benefits of hardworking truck drivers depriving them of retirement and health benefits they rightfully earned. Holding the defendants accountable puts others on notice that such conduct will not be tolerated. Every worker who puts in an honest day’s labor deserves no less,” stated United States Attorney Loretta E. Lynch.
If convicted of the charges, each defendant faces maximum sentences ranging from 5 to 20 year in prison on each count of the indictment.
Next Story: Deadly Carrier Takes Advantage of the System