Office of Labor-Management Standards (OLMS)
U.S. Department of Labor
Office of Labor-Management Standards
Honolulu Resident Investigator Office
300 Ala Moana Boulevard, Suite 5-121
Honolulu, HI 96850
(808) 541-2705 Fax: (808) 541-2719
July 12, 2011
Mr. Benjamin Toyama, President
IFPTE Local 121
LM Number: 502194
P.O. Box 786
Aiea, HI 96706
Dear Mr. Toyama:
This office has recently completed an audit of IFPTE Local 121 under the Compliance Audit
Program (CAP) to determine your organization’s compliance with the provisions of the Civil
Service Reform Act of 1978 (CSRA), 5 U.S.C. 7120, and the Department's regulations, 29 CFR
458. As discussed during the exit interview with Executive Vice President Irwan Sie, Staff
Administrator Sandi Toyama, and you on June 3, 2011, the following problems were disclosed
during the CAP. The matters listed below are not an exhaustive list of all possible problem areas
since the audit conducted was limited in scope.
Title II of the LMRDA establishes certain reporting and recordkeeping requirements. Section
206 of the LMRDA and Title 29 of the Code of Federal Regulations (C.F.R.) Section 403.7
require, among other things, that labor organizations maintain adequate records for at least five
years after reports are filed by which the information on the reports can be verified, explained
and clarified. Pursuant to 29 C.F.R. Section 458.3, this recordkeeping provision of the LMRDA
applies to labor organizations subject to the requirements of the Civil Service Reform Act of
1978 (CSRA) as well. Therefore, as a general rule, labor organization must retain all records
used or received in the course of union business.
For disbursements, this includes not only original bills, invoices, receipts, vouchers, and
applicable resolutions, but also documentation showing the nature of the union business
requiring the disbursement, the goods or services received, and the identity of the recipient(s) of
the goods or services. In most instances, this documentation requirement can be satisfied with a
sufficiently descriptive expense receipt or invoice. If an expense receipt is not sufficiently
descriptive, a union officer or employee should write a note on it providing the additional
information. For money it receives, the labor organization must keep at least one record showing
the date, amount, purpose, and source of that money. The labor organization must also retain
bank records for all accounts.
Mr. Benjamin Toyama
July 15, 2011
Page 2 of 3
The audit of Local 121’s 2010 records revealed the following recordkeeping violations:
General Reimbursed Expenses
Local 121 did not retain adequate documentation for reimbursed expenses incurred by Sergeantat-
Arms Delegate and former Business Manager totaling at least $10,413. For example, original airline receipts and hotel folios were
not maintained for various union-related trips taken by Pereira, Christensen and Fontanilla
during the fiscal year.
As noted above, labor organizations must retain original receipts, bills, and vouchers for all
disbursements. The president and treasurer (or corresponding principal officers) of your union,
who are required to sign your union’s LM report, are responsible for properly maintaining union
Based on your assurance that Local 121 will retain adequate documentation in the future, OLMS
will take no further enforcement action at this time regarding the above violations.
Pursuant to 29 C.F.R., Section 458.3, the reporting requirement under 29 C.F.R. Section 403.2
(see Section 201(b) of the Labor-Management Reporting and Disclosure Act (LMRDA)) is made
applicable to labor organizations subject to the requirements of the CSRA. This provision
requires labor organizations to file annual financial reports that accurately disclose their financial
condition and operations. The audit disclosed a violation of this requirement. The Labor
Organization Annual Report (Form LM-3) filed by Local 121 for the fiscal year ended March 31,
2010, was deficient in that Local 121 did not include some reimbursements to officers totaling at
least $22,642 in the amounts reported in Item 24 (All Officers and Disbursements to Officers).
It appears the union erroneously reported these payments in Item 54 (Other Disbursements).
The union must report most direct disbursements to Local 121 officers and some indirect
disbursements made on behalf of its officers in Item 24. A "direct disbursement" to an officer is
a payment made to an officer in the form of cash, property, goods, services, or other things of
value. See the instructions for Item 24 for a discussion of certain direct disbursements to officers
that do not have to be reported in Item 24. An "indirect disbursement" to an officer is a payment
to another party (including a credit card company) for cash, property, goods, services, or other
things of value received by or on behalf of an officer. However, indirect disbursements for
temporary lodging (such as a union check issued to a hotel) or for transportation by a public
carrier (such as an airline) for an officer traveling on union business should be reported in Item
48 (Office and Administrative Expense).
On June 28, 2011, Local 121 filed an amended Form LM-3 for the fiscal year ended March 31,
2010, to correct the deficient items discussed above.
Mr. Benjamin Toyama
July 15, 2011
Page 3 of 3
I want to extend my personal appreciation to IFPTE Local 121 for the cooperation and courtesy
extended during this compliance audit. I strongly recommend that you make sure this letter and
the compliance assistance materials provided to you are passed on to future officers. If we can
provide any additional assistance, please do not hesitate to call.
cc: Ms. Jamie Kobayakawa, Treasurer