NJ Is Leaving the Commission Overseeing Port Corruption. But Does the Mob Still Lurk?

New Jersey has pulled out of the Waterfront Commission of New York Harbor, created in 1953 to fight organized crime on the docks.

A freighter floats under the Bayonne Bridge
A freighter floats under the Bayonne Bridge. New Jersey has pulled out of the commission overseeing the port. Photo: Shutterstock

Shot almost entirely on the streets, piers and rooftops of Hoboken, On the Waterfront stunned film critics with its gritty depiction of Mobbed-up labor rackets and workplace violence that ruled the lives of Jersey longshoremen in the mid-1950s.

Audiences were aghast at the sleazy doings of cargo thieves, two-bit loan sharks and corrupt union bosses who made life hell for underpaid dockworkers.

It wasn’t entirely made up—in fact, the film was based on a Pulitzer Prize-winning series of articles that appeared in the New York Sun in the 1940s exposing corruption in the longshoremen’s union. 

Then New Jersey governor Alfred E. Driscoll was so incensed by all the thuggery that he pushed for the creation of an independent agency with special powers to fight organized crime on the docks. The result was the Waterfront Commission of New York Harbor, an agency designed to span the harbor in the true spirit of bistate cooperation. As Driscoll described it, “Organized crime does not respect state boundaries.”

Nearly 70 years later, the Waterfront Commission is officially going out of business, the victim of political and economic trends that Driscoll could not have foreseen. In April, the U.S. Supreme Court ruled that New Jersey could unilaterally withdraw from the agency that had been created by an act of Congress in 1953.

The decision ended a long-running legal battle that pitted the bistate Waterfront Commission and its supporters in New York against New Jersey Governor Phil Murphy and his allies in the International Longshoremen’s Association (ILA), the North Bergen-based union that has controlled hiring at the Port of New York and New Jersey since before On the Waterfront was ever filmed.

Union leaders claim the commission is a patronage mill that has outlived its usefulness and overstepped its authority, enforcing picayune regulations to justify its own existence. The commission, they argue, treats everyone like mobsters and scares business to other ports while dragging its feet on routine background checks and license approvals for new dock workers.

A 2018 law signed by then governor Chris Christie would transfer all of the commission’s oversight duties to the New Jersey State Police.

“The commission made a habit of harassing and retaliating against the honest, hardworking women and men of the ILA,’’ union president Harold Daggett said in April. “The people of New Jersey have the right to be free of this rogue agency.’’

The push to kill the agency was driven in part by an assumption that the heyday of organized crime on the waterfront was long past, especially in the era of container shipping, when mechanization has replaced many dock workers. But both the FBI and federal prosecutors supported the commission in its fight for survival, citing continuing Mob activity at the port. 

“This is nothing less than a total win for the union, a total win for the Mob,’’ says Walter Arsenault, who became the commission’s executive director in 2008 after a career spent investigating street gangs as chief of the Manhattan district attorney’s homicide investigations unit. “Organized crime is still a major factor in the port.’’

Arsenault ticks off notable Mob families prosecuted by the commission, or with its help, during his 15-year tenure, which ended with his retirement in February, including “the entire Lucchese leadership, a dozen Colombos, a dozen Gambinos, half a dozen DeCavalcantes.’’

Crime at the port, Arsenault says, comes with a steep cost: no-show jobs, work slowdowns, extortion rackets, container-repair scams and other schemes that drain millions from the public. “That’s one reason New York is the most expensive port in the world,’’ he says. “It all just gets passed to the consumer.’’   

The waterfront commission, the dock workers, and the union that represents them have played a huge part in the economic life of the port, an engine fueled by a record $271 billion in cargo last year alone, according to the Port Authority of New York and New Jersey.

The port is now the second largest in the nation, importing almost 10 million standard container units a year, with about 80 percent of the traffic on the Jersey-side docks. An estimated half a million people owe their jobs directly or indirectly to economic activity driven by the port. Among them are members of the 65,000-strong International Longshoremen’s Association, many of whose members work at docks and terminals stretching from Port Elizabeth to Red Hook.

In 2022, the union reported $74.5 million in assets, taking in nearly $53 million in receipts last year, mostly in the form of member dues and fees, according to recent union filings with the U.S. Department of Labor.

Executives and top employees were paid handsomely. Daggett, a third-generation longshoreman from Sparta who was first elected union president in 2011, received $759,231 in compensation last year. Six other top executives earned up to $600,000 last year, and 21 other employees listed as vice presidents were well into six figures.

The filings show ILA spent more than $1 million last year on meetings, entertainment and club fees. These expenses included nearly $145,000 for New York Yankee stadium tickets, nearly $20,000 for membership at the New York Athletic Club, and more than $592,000 to the Diplomat Beach Resort in Florida for an ILA convention. 

Throughout much of its history, investigators say, the longshoremen’s union was riddled with corruption connected to Mafiosi who have historically preyed on port operations. During the past decade alone, a string of top union figures were sentenced to prison after convictions in Mob-related rackets that preyed on the rank and file. 

In 2013, former ILA member Edward Aulisi was given 30 months after pleading guilty to extorting tribute payments from members of Local 1235 in Newark. Prosecutors said Aulisi conspired with a captain of the Genovese organized crime family in the scheme.

A year later, two other ILA members, identified by prosecutors as Genovese family “associates,” admitted to being part of a Mob racket that held sway on the docks for nearly three decades. One of the men, Albert Cernadas, was a former president of the Newark local as well as a ILA executive vice-president. 

That’s not all: In 2018, ILA member Paul Moe was sentenced to 24 months in prison for fraudulently collecting a nearly $500,000 annual salary, much of which was for work he never performed. Prosecutors said he showed up at his Port Elizabeth worksite as little as eight hours a week. 

Over the years, the corruption rubbed off onto the commission itself.

In 2009, the New York State Inspector General issued a scathing report detailing “numerous abuses of authority in hiring, supervision and fiscal oversight” at the bistate commission. The report detailed how the commission, which had about 100 staffers and an annual budget of $11 million, did favors for convicted felons while dragging its feet on routine licensing duties. “Instead of ridding the waterfront of corruption, this agency itself was corrupt,’’ the report concluded.

In the scandal’s wake, the commission reformed itself under the leadership of Arsenault and Ronald Goldstock, a Mob buster who had directed the New York State Organized Crime Task Force for 14 years.

The pair were credited with cleaning up the agency and reinvigorating its mission to keep organized crime off the docks. They also pressed to end what they said was the union’s lock on hiring and discriminatory employment practices. 

“We built a modern regulatory agency, created an intelligence operation, and began investigations with experienced cops,’’ Goldstock says. 

The newly reformed commission enforced a plan that opened more work positions to minorities and military vets. It curtailed the union’s ability to refer its own members for port jobs. “We ended the union’s control of hiring, and they were absolutely furious,’’ Arsenault says. 

Union officials did not respond to calls and messages seeking comment for this story. But allies of the union who pushed for an end to the commission said the reformed agency had abused its authority in an overzealous hunt for Mob influence.

“They were hellbent on extending their reach,” says former New Jersey state Sen. Ray Lesniak, the initial sponsor of the bill to kill the agency. “They were scaring business to other states.’’

The Shipping Association of New York and New Jersey, which represents carriers and port companies regulated by the commission, welcomed the agency’s demise and said that innocent work applicants with Italian-sounding names had been unfairly singled out by the agency.

John Nardi, the group’s president, says the association did a study and found that port applicants whose last names end in a vowel had to wait an average of 97 days for approval—about twice as long as all other applicants. “The commission was constantly putting forth new and changing [hiring] provisions,” he says. “We were always in the middle.”

Nardi says the association will go to court if the commission does not return millions in surplus it built up over the years through assessments on its members. “It’s our money. We want it back.”  

Jeff Pillets is a journalist and Pulitzer Prize finalist whose work has appeared in ProPublica, New Jersey Spotlight News, WNYC-New York Public Radio and The Record.

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