When it came to John Dougherty’s spending, Local 98 office manager testifies she ‘took him at his word’
Local 98's office manager testified she routinely had to harass Dougherty to file expense reports and to explain thousands of dollars in charges he rang up monthly on his union-issued credit card.
Like any office, Local 98 of the International Brotherhood of Electrical Workers had strict guidelines governing when and how its union-issued credit cards could be used.
But there was one member for whom exceptions to those rules were regularly granted, the union’s longtime office manager told a jury Tuesday.
“John Dougherty,” said Lisa Ketterlinus, as she testified on the third day of ex-union chief’s federal embezzlement trial.
Ketterlinus, who has run day-to-day operations in Local 98′s Spring Garden Street headquarters for more than two decades, said she routinely had to harass Dougherty to file expense reports for his credit card use and to explain the business purpose of the thousands of dollars in purchases he rang up on his union American Express card each month.
When she could get him to focus, she told jurors, they’d sit down together for marathon sessions in the union’s office kitchen to go over months of reports. Dougherty, she said, would offer explanations for many of the expenses — for instance, lunch meetings with union employees or officials to discuss Local 98 business.
But there were plenty of instances in which he said he couldn’t remember or provided no explanation at all. Ketterlinus still approved the expenses if Dougherty insisted they were for union business.
“Did you ever challenge him?” Assistant U.S. Attorney Bea Witzleben asked.
Ketterlinus responded: “No, I took him at his word.”
Prosecutors maintain that lack of control when it came to Dougherty enabled him to spend tens of thousands of dollars in union cash on personal purchases for him and his family, one of the central allegations of the case.
While other members who failed to follow the rules had their pay docked to reimburse the union or their credit cards taken away, Witzleben noted in her questioning Tuesday, Dougherty kept on spending.
For instance, when in 2014 he offered no explanation for a $548 bill at Target for items including a Christmas tree, Cinnamon Toast Crunch cereal, Bagel Bites, TV dinners and scented candles, the union reimbursed him fully.
» READ MORE: What prosecutors say Dougherty bought with Local 98 money
In other instances, government lawyers maintain, Dougherty simply lied.
After using his Local 98 Amex to pay for a 2015 dinner at Pietro’s in Center City for him, his wife and another member of his family, Dougherty later told Ketterlinus the meal was for a meeting with another labor official to discuss “diversity in the union movement,” prosecutors said. Ketterlinus dutifully recorded that on his expense report.
Dougherty, the office manager said, was also one of the only Local 98 members who routinely applied for reimbursement for expenses he paid out of pocket with cash — often with no receipts. As prosecutors tell it, that vague accounting allowed the ex-union chief to steal an additional $1,500 between 2010 and 2016.
For his part, Dougherty has pointed to many instances in which he voluntarily identified personal expenses he made on his credit card — for dry cleaning or shoe repair — and reimbursed Local 98 for their cost.
He’s chalked up any errors that might have made it past him as “innocent mistakes” made in the course of working tirelessly on behalf of his union.
“Frankly, they were doing the best they could to categorize the expenditures in the right way,” defense lawyer Greg Pagano told the jury during his opening statement Monday.
But while Pagano has not yet had an opportunity to cross-examine Ketterlinus, he noted Tuesday that at some point the FBI believed she bore criminal responsibility for enabling Dougherty’s spending.
In grilling Jason Blake, the FBI’s lead investigator, earlier in the day, Pagano pointed to a 2015 affidavit in which agents described their belief at the time that “Ketterlinus was conspiring with Dougherty to assist him in obtaining reimbursement for his personal expenses.”
» READ MORE: What you should know about the case
But prosecutors balked at that line of questioning, noting that they have not charged Ketterlinus with a crime and have not accused her of any wrongdoing.
Like everyone at Local 98, they’ve said, she worked at Dougherty’s pleasure and simply followed his orders.
As prosecutors have described it, he held the ultimate say-so on almost every decision the union made — including payroll, which Ketterlinus also oversaw, and which prosecutors say was another means through which Dougherty fleeced union members.
They’ve accused him of putting several of his family members on the payroll — including Dougherty’s niece Maureen T. Fiocca, who held a summer job for the union while attending college. The government has alleged Dougherty arranged for her to be paid for work she did not do and paid her well after she returned to her classes.
Witzleben also questioned Ketterlinus on another union credit card regularly used by three Local 98 members — Dougherty’s nephew Brian Fiocca, Niko Rodriguez, and Tom Rodriguez — who prosecutors say largely served as Dougherty’s personal errand boys.
Known collectively within Local 98 as “the kids,” prosecutors say they spent hours running Dougherty’s personal errands like shopping for groceries, ferrying his family members to appointments, or cleaning and maintaining their homes.
Ketterlinus told the jury Dougherty had her issue another union Amex to the trio, a card referred to around Local 98 offices as “the kids’ card” and with which prosecutors say even more of Dougherty’s personal expenses were paid.
At one point Tuesday, Witzleben asked Ketterlinus who decided how much “the kids” would be paid for carrying out Dougherty’s business.
The office manager offered the same answer she’d given all day when asked about who made decisions at Local 98: “John Dougherty.”