‘In hindsight ... that was incorrect’: Scrutiny shifts to oversight of Local 98′s spending at Johnny Doc trial

Throughout their federal embezzlement trial, ex-labor leaders John Dougherty and Brian Burrows have challenged accusations that they stole hundreds of thousands of dollars from the union they once led by pointing to the auditors, accountants, and other recordkeepers who annually reviewed its finances and flagged no significant issues.

But as the proceedings entered their ninth day Thursday, prosecutors aimed to expose those safeguards as little more than rubber stamps.

Michael Mascuilli — former recording secretary for the executive board of Dougherty and Burrows’ union, Local 98 of the International Brotherhood of Electrical Workers — told jurors the board provided next to no scrutiny over how union money was spent.

» READ MORE: As it happened: Testimony in John Dougherty embezzlement trial focuses on Local 98 expenses, Pennsport bar repairs

Instead, he said, at their meetings — which included Dougherty, Local 98′s business manager, and Burrows, its then-president — members merely signed off on bills that Burrows told them had already been paid.

“In hindsight, I guess I could say that was incorrect,” Mascuilli said. “But at the time, I didn’t knowingly know.”

As prosecutors tell it, those bills included invoices with thousands of dollars’ worth of inflated expenses from a contractor who regularly performed repair and renovation work on Local 98-owned buildings.

The contractor, Anthony Massa, testified earlier in the trial that Burrows had instructed him to inflate the price he was charging the union for those jobs by tens of thousands of dollars to cover his fees for carpentry work he did on the side at the homes of Burrows, Dougherty, and Dougherty’s relatives.

Burrows’ laawyers say Massa is “a liar and a fraudster.”

» READ MORE: ‘You are still a liar’: Defense attacks key government witness in John Dougherty’s embezzlement trial

But Mascuilli told jurors that Massa’s invoices — like most bills that came before Local 98′s trustees — had already been paid by the time Burrows presented them to the executive board for approval.

That practice changed, he said, after Dougherty, Burrows, and other union officials were indicted for misspending union money in 2019 and IBEW’s international organization intervened to shore up the local’s finances.

In addition to the jobs done at Dougherty’s and Burrows’ personal residences, prosecutors say Massa billed the union for thousands of dollars of repair work at Doc’s Union Pub, a now-shuttered Pennsport bar in which the men had a financial interest.

But the business’ auditor, Matthew Mingey Sr., also appeared blind to potential red flags.

As Mingey testified Thursday, Assistant U.S. Attorney Jason Grenell walked him through the tax filings he prepared for the bar from 2012 to 2015, which consistently reported that no money had been spent to pay employee salaries each year.

“Mr. Mingey, have you ever been to a bar? Do they have employees who hand out drinks and sell them to people?” Grenell asked incredulously.

Mingey sheepishly agreed.

In 2016, the pub reported gross revenue of $18,500 but no expenses.

“They sold $18,500 worth of things that cost them $0?″ Grenell balked.

Mingey responded: “I don’t know what was going on then at that period of time.”

Ultimately, the auditor said, he relied on Burrows and his partners to provide him with accurate financial information and at no point did they mention Massa’s repairs and renovations, which were also missing from the business’ taxes.

Massa’s own accounting was called into question later in the day as attorneys for Dougherty and Burrows questioned FBI Special Agent Jason Blake, the bureau’s lead investigator in the case.

As they reviewed notes the contractor kept of his time working on the union leaders’ personal residences, the defense lawyers suggested that Massa had padded the records of labor and materials costs for those jobs.

“We have to take the word of Mr. Massa?” Dougherty lawyer Henry M. George asked at one point.

» READ MORE: Johnny Doc's trial: A day-by-day recap

Seven years earlier, it had been George’s client asking people to take him at his word.

As the day wound to a close, prosecutors played more recordings from the FBI wiretap of Dougherty’s phone — including a call shortly after a series of 2016 FBI raids revealed authorities were investigating Dougherty for misusing union money. On the call, the union chief sought to assure a representative from IBEW’s international organization it had nothing to worry about in terms of how Local 98′s money was being handled.

“There’s no movement of money,” Dougherty told Don Siegel, then the vice president of the umbrella organization, adding later: “I’m not one bit concerned about all that stuff.”

Testimony in his trial is set to resume Friday.