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Office of Labor-Management Standards
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Office of Labor-Management Standards (OLMS)

U.S. Department of Labor
Office of Labor-Management Standards
Seattle District Office
1111 Third Avenue, Suite 605
Seattle, WA 98101
(206) 398-8099 Fax: (206) 398-8090
April 25, 2011

Mr. Robert Pratt, Secretary-Treasurer
Locomotive Engineers, IBT Division 758
612 E. McLoughlin Blvd.
Vancouver, WA 98663-3393

Case Number:
LM Number: 038757

Dear Mr. Pratt:

This office has recently completed an audit of Locomotive Engineers Division 758 under the
Compliance Audit Program (CAP) to determine your organization’s compliance with the
provisions of the Labor-Management Reporting and Disclosure Act of 1959 (LMRDA). As
discussed during the exit interview with you on March 18, 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.

Recordkeeping Violations

Title II of the LMRDA establishes certain reporting and recordkeeping requirements. Section
206 requires, among other things, that labor organizations maintain adequate records for at least
five years by which each receipt and disbursement of funds, as well as all account balances, can
be verified, explained, and clarified. As a general rule, labor organizations must maintain 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. Robert Pratt
April 25, 2011
Page 2 of 3

The audit of Division 758’s 2010 records revealed the following recordkeeping violation:

General Expenses

Division 758 did not retain adequate documentation for five disbursements to the Internal
Revenue Service for back taxes and penalties totaling $14,924.74.

As previously 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 records.

Based on your assurance that Division 758 will retain adequate documentation in the future,
OLMS will take no further enforcement action at this time regarding the above violations.

Reporting Violations

The audit disclosed a violation of LMRDA Section 201(b), which requires labor organizations to
file annual financial reports accurately disclosing their financial condition and operations. The
Labor Organization Annual Report (Form LM-3) filed by Division 758 for fiscal year ending
December 31, 2009, was deficient in that a $5000 loan provided to a union member in 2008 was
not reported.

1. Deficient Form LM-3
Division 758 must file an amended Form LM-3 for fiscal year ending December 31, 2009 to
correct the deficient item discussed above. I provided you with a blank form and
instructions, and advised you that the reporting forms and instructions are available on the
OLMS website (www.olms.dol.gov). The amended Form LM-3 should be submitted to this
office at the above address as soon as possible, but not later than May 15, 2011. Before
filing, review the report thoroughly to be sure it is complete, accurate, and signed properly
with original signatures.

2. Delinquent Form LM-3
The audit disclosed a violation of LMRDA Section 201(b), which requires labor
organizations to file annual financial reports accurately disclosing their financial condition
and operations. The Labor Organization Annual Report (Form LM-3) for the period ending
12/31/2010 is delinquent. The delinquent Form LM-3 should be submitted to this office at
the above address as soon as possible, but not later than May 15, 2011. Before filing, review
the report thoroughly to be sure it is complete, accurate, and signed properly with original
signatures.


Mr. Robert Pratt
April 25, 2011
Page 3 of 3

I want to extend my personal appreciation to Locomotive Engineers Division 758 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.

Sincerely,

Investigator