SAG Members Push for Independent Investigation Into Charges of Pension-Plan Embezzlement

Thu Dec 22, 2011 4:06pm EST

Over 560 people have signed an online petition calling for an independent investigation into allegations that Bruce Dow, CEO of the Screen Actors Guild's health and pension plans, covered up a $5 million - $10 million embezzlement scheme and raided the fund for personal use.

“People are fed up,” Paul Edney, a SAG member who signed the petition, told TheWrap. “They are ticked off because it’s our money that’s being stolen.”

Also read: CEO of SAG Pension Plan Accused of Embezzlement Cover-Up (Exclusive)

The allegations stem from a labor department complaint from Craig E. Simmons, an ex-employee of the Screen Actors Guild's Producers Pension and Health Plans (SAG-PPHP), who charges fraud and theft by his former employers.

In documents filed with the department in September, Simmons claims he was told by Dow not to discuss an alleged embezzlement scheme by former chief information officer Nader Karimi and to lie to authorities about other questionable financial activity.

Simmons, who was fired as SAG-PPHP's executive director of HR, IT and risk management earlier this year, also accuses Dow of raiding the benefits plan to lavish money on family members and pay for his wife’s breast-enhancement surgery.

After news of the complaint broke on TheWrap, the plan’s board pledged a “full review” of Simmons’ allegations and announced that it had retained outside counsel to conduct the investigation.

However, the petition claims that the counsel SAG-PPHP turned to -- attorney Nancy Solomon -- is a friend of SAG's national executive director, David White and worked with him previously at the law firm of O’Melveny & Myers.

Online biographies of both Solomon and White do mention stints at the white-shoe law firm, but it's not clear if their time overlapped..

“Due to these close associations, we have serious concerns that Ms. Solomon’s objectivity and due diligence may have been compromised, resulting in the cherry-picking of certain people to interview while overlooking others who may not have been as supportive of Mr. Dow,” the complaint reads.

A spokesperson for SAG-PPHP declined to say if an investigation has been concluded, but said that the petition contains inaccurate information.

None of the individuals interviewed by TheWrap could say who authored the petition. Simmons did not respond to requests for comment about whether it was started at his instigation.

The petition also claims that Solomon presented a report to the plan’s trustees and asked for Dow to pay back tens of thousands of dollars in unauthorized moving expenses. But, it reads: “Merely returning the money is not sufficient to right this wrong. At what threshold of wrongdoing is punitive action taken?” 

“We are hearing nothing about what is being done to address or shine light on these issues,” the petition adds. “From out here it looks as though you are not exercising your fiduciary duties as trustees.”

The charges especially have riled up members already agitated by a proposed merger with the American Federation of TV and Radio Artists and a leadership that they maintain has been less than transparent.

“It’s merger, merger, merger and when other matters come up, the leadership doesn’t want to talk about it,” Edney told TheWrap.

White could not be reached for comment, and Solomon did not respond to requests. 

A spokesperson for SAG declined to comment and said that the roughly $2.5 billion pension plan is operated independently of the union. A spokesperson for SAG-PPHP said that the plan’s trustees are developing “a communication” designed to update union members about the status of the investigation. 

That’s not good enough for some members, who are charging the plan’s leaders with dragging their feet.

“What’s behind this is you have a bunch of members waking up and realizing that things are not as rosy as we’re being told in all the press releases,” Clancy Brown, a SAG member who signed the petition, told TheWrap. “There’s a culture here that says that the members are idiots and don’t know what’s good for them and that it’s better to take care of things in-house. There’s never really been an independent accounting of the pension and health fund.”

Both Brown and Edney say that they attended a raucous meeting last week at Avery Schreiber Theater in North Hollywood that was sponsored by the anti-merger group Union Democracy Now. During the meeting, Simmons addressed the roughly 60 people in attendance and outlined his allegations.

“I hadn’t met Craig before [the meeting], but he’s not disgruntled,” Edney said. “He just wants the truth out there. This guy is brilliant, and he’s an attorney, so he’s not going to make these charges idly.”  

Related Articles:  CEO of SAG Pension Plan Accused of Embezzlement Cover-Up (Exclusive) SAG Pension Fund Board Pledges 'Full Review' of Embezzlement Charges

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