Longform

COOKING THE BOOK

Page 4 of 5

In the late 1980s, Zukerman says and current and former U S West salespeople confirm, his advertising orders became so big--involving so many different cities and directories--that he moved his account to the national Yellow Pages sales office.

The national office, based in Maryland, handles huge accounts--like truck-rental firms or moving companies--that advertise in many books across the country and want to coordinate their advertising, instead of dealing with dozens of salespeople in myriad markets.

In 1991, Zukerman says, he was pulling back, selling his various businesses off as franchises. That meant his advertising would return to the Phoenix office of U S West Direct.

When the Zukerman account was rumored to be returning to Phoenix from the national office, current and former salespeople say, the salespeople in Phoenix began salivating. Zukerman meant a lot of money in commissions for somebody.

But Zukerman, according to documents in the NLRB case, also had a bit of a problem paying his bills. In fact, he had fallen behind far enough that the U S West Direct credit department had decreed Zukerman had to pay 12 months worth of bills in advance to place advertisements in any of its directories.

When the Zukerman account arrived back at U S West Direct, court documents indicate and salespeople who watched the situation say, there seemed little question that company policy dictated the lucrative account be assigned to Roxie Winters. She had handled the Zukerman account before it moved from Phoenix to the national sales office.

But Winters never received the golden goose. Instead, the account was assigned to Karen Ortega. Winters filed a grievance with the union, which was not heard for more than a year. Ortega, ranking officer of the union local hearing the grievance, was ultimately affirmed as the proper salesperson for the account.

In the files of the NLRB, the Zukerman account now stands as perhaps the strongest evidence of how Ortega and other union officials manipulated records to enhance their own salaries and performance, and possibly harmed other advertisers who had no idea that corruption in the company was costing them business.

Turn to page 109 of the 1994/95 Yellow Pages that are now probably sitting under your telephone. You will see what appears to be a page with two advertisements on it--one for a company named Phoenix Service Center and the other for a company named Same Day Appliance.

Each company offers to fix whatever is broken in your dishwasher, refrigerator, washer, dryer or stove.

Look very closely, and you will see--in very small print--that the two companies are "affiliated" with each other. Between them, the two ads feature five phone numbers that someone in need of stove repairs might conclude are different businesses. A customer might call several of the numbers seeking different bids on the cost of a repair.

But all of the numbers connect you to phones that ring at the same place.
That place is the appliance-repair business once owned by Gerald Zukerman, which he says he has since sold.

The practice is not illegal, and does not violate the Yellow Pages company rules. There is no reason to believe the companies cannot repair your appliances or that they will in any way cheat you on a deal.

But the advertisements, according to documents now public at the NLRB, demonstrate how officers of the IBEW used their positions to place misleading advertising in the Yellow Pages.

Various U S West documents now contained in the public record indicate that Zukerman--when he owned the two businesses--was frequently behind in paying his bills, and probably should not even have been allowed to place advertisements in the book.

But he was allowed to, and his ads ran in front of other repair companies that were paying their bills.

Further, the government is arguing based on company documents, Ortega used the Zukerman account to skim extra commissions and bonuses from the company.

Zukerman admits that he frequently disconnected and reconnected various phone numbers as part of his business. He would, for instance, turn off the phone numbers he used in ads for heating repairs during the summer, and turn them back on again in the winter.

When he turned phone numbers off, Zukerman says, U S West would stop billing him for the advertisement. In effect, he would pay for his advertisements for only the few months of the year when they did him any good.

Because Zukerman was frequently disconnecting phone numbers, the government documents assert, Ortega was able to manipulate his account records to make more money.

The documents indicate that Ortega would move advertising records from one phone number to another, allowing her to make existing ads look like "new money," for which she was paid high commissions. These moves also lowered her total sales at the beginning of a book cycle so she could enhance her apparent performance, the documents allege.

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David Pasztor