Trade Unions are exempt from registering with the Fincancial Services Authority as claims handlers and do not have to give key facts

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#1 why "laundry"?

Look at our Laundry: (back to UnionFailure.html#where-does-union-money-go)

  • Steve Hart, Regional General Secretary, Unite Transport and General Workers UnionThree complaints about the branch employment lawyer who goes to court without evidence
  • Employment lawyers paid 66p per member per year
  • A retiring official who didn't turn-up to recognition agreement, disciplinary or dismissal meetings and was "too busy" to help prepare a case; a new one who says the branch "functions exactly as a branch is supposed to function, making donations to working class charities" after watching them "put on one side" a motion to fund proper legal insurance and lawyers until the central union could be sorted-out and saying "I wash my hands of this" to requests to get a strong case sorted-out.
  • A regional secretary who (see right) "has procedures in place" not to fund other lawyers than the union's own panel, dispite a law saying that he has to and no system for saying what his procedures are, getting his secretary to fob-off complainants rather than dealing with them himself
  • Electoral systems that allow a show of hands round a table to elect a local branch committee and a less than 10% turnout to appoint a regional manager or an executive committee member

The regional general secretary on the right is a fashionable Labour party member; most of the branch's six activists (elected on a turnout of six to control a £20,000 bank account) are in the photo below. They are all or mostly members of the 39-strong Communist Party of Britain. What they have in common is taking money out of union accounts for political parties. Mainstream and fringe parties are happy to leave 66p per member per year for employment lawyers according to an interview with The Lawyer by Unite the Union's Transport and General Section legal director.

"I'm afraid to say, that having been involved in the TGWU for nearly forty years, in Region 1, that the TGWU could leave its self open to suggestion that there may be some history of funny business."

"I remember Ken Reid - then Regional Sec of Region 1 - ripping some kid to pieces over the phone, because he had asked about a 'Trades Council Fund' held by Region 1: the boy thought it referred to the trades councils, but Ken was emphatic that the lad had no business asking questions - and I never did find out what precisely the £100,000 was actually for - except it was not for the Trades Councils."- email recieved 24/4/2008


  • "
  • The heading says "Look at our laundry" bacause the marchers are holding a piece of laundry between two poles. Also, the two parties quoted both benefit from the same system of donations-on-behalf of members favoured by the union.

    Phrases like - washing dirty laundry in public; money laundering, tax evasion, fraud - might already be in the mind of any reader. The first couple of definitions of money laundering that come to hand mention concealing and confusing, money transfer so that at one end of the chain of transactions it can look legal and at the other end it can be illegal, so, sadly, I can't write that "donations on behalf" are the same as money laundering.
  • There's nothing to suggest illegality here. A decentralised union in which different committees can pay separately for similar things is bound to be confusing but a lot of it is very honest-looking. The Cuba Solidarity Campaign, frequent recipient of small donations, only has five paid staff in a dingy office and the pay is £21,000 a year. Other payments are open but obscure. Branch 1/1148 members pay a central fund, most of which goes to a regional office that donates-on-behalf-of-members to a list of 22 causes; some goes to a branch fund that's used to donate-on-behalf to a similar list and some to a central office that presumably donates-on-behalf too. Some payments are affiliations to four borough trades councils which also donate-on-behalf, and affiliate to a London regional trades council which donates-on-behalf like the South East Regional TUC. These last two also receive money directly from branch 1/1148 and so it goes-on.
  • There's everything to question.
    Very large amounts of money end-up in the Labour Party, according to the Electoral Commission, and the Morning Star overdraft. Something - possibly just donations from an activist who has inherited art treasures - finances a proper office and printing press for a tiny Communist Party of Britain. So money leaves union accounts by confusing routes and some money also finds itself in these places from confusing routes. There's also the legal budget. The Certification Office has decided that it was "not parliaments intention" to allow union members the right to "conduct an audit" of legal receipts but there is an odd ratio of payment to personal injury lawyers (90%) to employment lawyers (10% with the cost of defending against complaining members) suggesting that the union is using no-win no-fee lawyers. So if the lawyers win, where does their cut go, if the union is paying them large amounts for referring personal injury cases? Other claims handling agents get paid by lawyers, but concentrate on personal injury work. This union concentrates on personal injury work but says it's paying the lawyers.
  • What the system suggests is that it needs to be more transparent and that the idea of "donations-on-behalf" which unites all the political parties recieving the money needs to end. Meanwhile it would cost next to nothing for these organisations to post exact amounts paid and recieved between each other on their web sites or public accounts, so that anyone can check that money paid by one is the same as money received by another and none has got lost along the way.

  • I will get back to you if enough people are interested in proper legal insurance for employees. For now, the email handling is handled by Aardvark Mailing List. Like Pledgebank, this list is for people who would like there to be cheap legal insurance but don't set it up because not enough people want it at once to make it viable. If you check out Aardvark, you will see that they remain free bacause they don't give email addresses to list owners; if anyone hijacks your email address it will be them, not, and they look honest. You can add your name to the list to be told when there are a lot of people on it and cheap legal insurance is possible.
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