GR EXTRA!

'Racket paper' scams have moved online, too

Business owners fleeced by fast-buck operators claiming union connections

Andy Zipser, Editor

11 Jan 2010

The Guild Reporter

There must be something about unions that has the same effect on quick-buck artists and other hustlers that a "kick-me" sign has on junior high students. They just can't seem to avoid unwanted attention.

Years ago, a notoriously persistent scam involved selling ads in flimsy or non-existent "union newspapers." Buying such an ad, businessmen were told, would prove they were "friends of labor"—and it wasn't unusual for those who wouldn't be friends to run into hard times, including vandalism and roughed-up employees. Such goon tactics prompted the AFL-CIO to ban advertising in its member unions' publications in the mid-1950s and to create the International Labor Press Association, which offered a seal of legitimacy to distinguish real union publications from the bogus ones. Now called the International Labor Communications Association, the organization still exists and publications like The Guild Reporter continue to display the ILCA logo.

Half a century later, however, the same racket still flourishes—sometimes involving the very same miscreants. The Trade Union Courier (see separate story), for example, finally may have ended its decades-long run after its owner was sentenced to five-years' probation for a related tax-evasion scheme. But other, more slick variations on the theme keep emerging, such as the still-born U-Magazine (the "U" standing for Union) of a couple of years ago. And as print publications have moved increasingly online, so too have the rip-off artists, with such creations as unions.org, unionfriendly.com, unitedworkforce.org, unitedunions.org, unionmembersweb.com and other, equally suggestive URLs.

As the names imply, such bogus web sites implicitly suggest—or explicitly state—that they're union connected, relying on deception rather than the outright extortion of their print predecessors. All have home pages loaded with union logos and hot links to various unions and union-related institutions, such as the National Labor College, WINS radio news or Union Privilege, to create an aura of union acceptance. And all promote themselves as being heavily trafficked by millions of union members, ostensibly providing a captive audience for "union friendly" service providers who advertise on the site. 

Unionfriendly.com, for example, claims to have more than 5,000 pages on its site and more than 3,500,000 unique visitors each month.  Unitedunions.org appears to still be under construction, but nonetheless already claims it has "long been the preeminent national resource for Union related information and resources." And unions.org trumps everyone, if in egregiously ungrammatical terms, by claiming it has been "servicing 18.3 million Union members population for over 25 years. We have achieved to 'Unions.org' has over 300,000 keywords optimized on all major search engines."

Overblown as such claims are, the sites themselves are so thin that even a cursory examination should raise numerous red flags.  The resources that supposedly keep union members coming back on a regular basis are either non-existent, outdated or readily available elsewhere. The "stewards corner" button at unionfriendly.com, for example, links to a page that has all of six sentences on it, to the effect that stewards have "a tough job, but there is no more important job in the entire union."  The "worker's rights" button, meanwhile, links to a page filled with three sentences referring—but not linking to—an AFL-CIO website.

Other links are simply bizarre, with none more confused than unitedworkforce.org. Declaring its purpose is to "strengthen the backbone of our country,"  the site's homepage is a pastiche of hot links to unions, government workers and members of the armed forces—as well as John 3:16 and a YouTube posting of "Lead Me To the Cross."  A button marked union/gov kids links to a page in French for a site based in Mauritius. The "news" button leads to a page with links that literally are all over the map, from FinfactsIreland to Pambazuka News, which features "PanAfrican voices for freedom and justice."

Given such a shoddy presentation, one might think that a businessman with a shred of common sense would shy away from a sales pitch from any of these sites, especially given the rates they charge. Unitedworkforce.org has the most outsized ambitions in that regard, quoting a rate of $20,000 for a top-of-page banner on its home page, but banner ad rates of $2,000 to $5,000 are common and even a simple Yellow Pages-style listing runs $199—and judging by some complaints, becomes an invitation for a hard sell to upgrade. Nonetheless, a  fair number of lawyers, chiropractors, insurance agents, bail bondsmen, real estate agents and other service workers dependent on a steady flow of new customers seem all too vulnerable to a fast-talking voice on a telephone.

Typical, for example, is a complaint on a web site known as the  Ripoff Report—itself a controversial and often criticized venture because of its anonymous postings and its founder's dubious ethics—from a business owner who paid $300 for a listing on unitedworkforce.org. "We have not received one call from anybody that is a member of a union," the Sacramento-based chiropractor wrote. "We have called around to many local union halls, they have never heard of them. We also discovered the other companies listed on their site (including some  attorneys) have heard nothing!"

But it's not just small businessmen who don't do their homework—unions themselves can get sucker-punched. In early 2005, for example, Michael Maddy, founder of the company now known as unions.org, contacted Bob Balgenorth, president of the California building trades council, to propose a joint "labor summit."  Although he subsequently disavowed the venture and emphasized that at no time was the trades council a co-sponsor of the event,  Balgenorth initially agreed to serve on an advisory council and to be a speaker at the summit—and with that, Maddy was off and running, selling tens of thousands of dollars in program ads and sponsorships and advance tickets on the strength of the trades council's supposed involvement.

In fact, the labor summit never took place and unions.org and the trades council ended up in court in a dispute that took two years to resolve. While a jury eventually concluded that Balgenorth and the trades council had clean hands, that didn't restore more than $100,000 shelled out by 30 or so businesses—including such substantial companies as Ameriquest and Kaiser Permanente.

Unions also showed themselves to be willing marks when Anthony Ditton made the rounds in Washington, D.C. in early 2006 to promote U Magazine. Fielding a glossy sample of what he had in mind, complete with a stunning cover photo of Vivica Fox, Ditton offered to let international unions distribute the magazine to their members for free in exchange for two pages in each issue to use as they saw fit, plus a spot on the cover for their union logo. With unions slashing publication budgets even then, the idea of getting a free ride in such a slick publication proved irresistible for the National Association of Police Officers and enormously alluring to others.

"It's an opportunity for us to communicate directly with our members about things going on here in Washington," explained NAPO's executive director at the time. Although the union was already publishing a Washington report every four to six weeks, "this is a much nicer looking and lengthier publication than anything we can do," he added.

U Magazine never took off, undone perhaps by a critical story in the ILCA Reporter, and other similar scams have also sunk. Unionmembersweb.com, for instance, now comes up as a Japanese web site, after a period in the middle Bush years when it promoted itself as "the #1 informational union site in the country." That site, too, may have been torpedoed by the ILCA, especially when the association reported that the site's administrator had served 15 months for  wire fraud and been sued for embezzling $300,000 from a former employer.

But for every site that disappears, two more seem to spring up, and those that don't go away learn how to adapt to deflect criticism. Some, for example, used to feature bogus union "bugs" on their pages to claim union membership; not only has the practice largely stopped, but some now disclaim—if you look hard enough to find it—any union affiliation despite all the more prominent hoopla that suggests otherwise.  Unitedworkforce.org, for example, states at the bottom of its home page that "Use of Logo's [sic] and Names of Unions do not reflect sponsorship or endorsement of Unions." Unionfriendly.com has a "disclaimer" button at the bottom of its home page that links to a page of numerous caveats: buried among them is the statement, "Unionfriendly.com is not affiliated with any union or association nor does Unionfriendly.com represent itself as a union."

For all that, the sales pitches keep coming and confusion abounds. The Oregon AFL-CIO recently contacted the ILCA to inquire about unitedworkforce.org and subsequently issued a warning, advising its members "to simply keep away from what is, at best, a shady operation."  A blog posting the next day by "Dr. X," apparently a psychologist, said he'd been contacted by a unitedworkforce salesman "who uses every manipulative, high-pressure sales device in the book." Indeed.

Or to turn to an overused but greatly apt warning: caveat emptor.