A GM strike could come as early as Sunday. But a union scandal makes negotiations harder

A deal just became much more difficult to reach.UAW President Gary Jones was directly implicated late Thursday in a growing scandal involving the union and its finances, the Detroit News reported. It could further damage the necessary trust that rank and file union members have in the union's leadership during negotiations.The scandal involves misappropriation of union funds, and in some cases, union officials accepting bribes from officials at one of the automakers, Fiat Chrysler.Agents from the FBI, IRS and Labor Department had searched Jones' home late last month, an FBI spokesman confirmed to CNN. On Thursday a top union official, Vance Pearson, became the first active union official to be indicted in the scandal. Nine other people who have pleaded guilty in the scandal were former union officials, the widow of one union official, or employees at Fiat Chrysler who dealt with the union.The indictment did not name Jones, but the Detroit News reported that he's one of the unidentified co-conspirators named in the government's filing, identified only as "UAW Official A." The News cited three unnamed sources for its report.The allegation against the UAW president, even if only in a news report, could be bad news for GM in its hope of reaching a deal with the union at a difficult time for the industry, said Kristin Dziczek, vice president of industry labor and economics for the Center for Automotive Research, a Michigan think tank."GM has no interest in having a weakened UAW," said Dziczek. "They don't want to reach a tentative agreement with leadership on the other side of the table who can't get it ratified by rank and file."Four years ago, union members only narrowly ratified deals with the three automakers, even without a scandal and the industry economics being better than they are today. Negotiations were going to be difficult, even without the scandalThe three US automakers with UAW contracts, GM (GM), Ford (F) and Fiat Chrysler (FCAU), are all dealing with slower sales and the need to make huge multi-billion-dollar investments in developing electric and self-driving vehicles that have more long-term potential than current market demand.To save money for those efforts, GM has already halted operations at three plants — two transmission factories and an assembly line in Lordstown, Ohio. It plans to shut another assembly line in Detroit, its last Detroit factory, early next year. The UAW has vowed to win GM's agreement at the negotiating table to keep all or at least some of those plants operating.The UAW did not immediately respond to a request for comment on the Detroit News report. As for the indictment, it said the legal problems would not stop it from reaching a deal that is in the best interest of its 46,000 members at GM."Our highest priority is maintaining the trust and confidence of United Auto Worker members," the union statement said. "While these allegations are very concerning, we strongly believe that the government has misconstrued any number of facts and emphasize that these are merely allegations, not Read More – Source