In August, Federal officials found that Carey aides had illegally diverted union money to help his re-election campaign, annulled his narrow victory over Mr. Hoffa and ordered a new election.

That election was overturned and a new one ordered when a Federal monitor found that three Carey aides had misappropriated more than $700,000 from the teamsters' treasury to help the Carey campaign.

Mr. Hoffa lost the 1996 race to Ron Carey, but a new election was ordered last year because three Carey aides siphoned money from the union treasury into the Carey campaign.

His 74-page decision cited testimony by three Carey aides tying the union's president to the scheme, in which more than $700,000 in teamster money went to several liberal nonprofit groups, including Citizen Action.

Federal prosecutors are also investigating accusations, made by the Carey aides who pleaded guilty, that the A.F.L.-C.I.O.'s secretary-treasurer, Richard Trumka, helped channel teamster money through some intermediaries into the Carey campaign.

Although officials say some Carey aides have now told them that the president was generally aware of the fraud, many details of the witnesses' accounts could not be learned.

The settlement might also help nonunion workers forget the teamsters' corrupt past as well as the charges that Carey aides face over diverting money from the union's treasury into his re-election campaign.

Teamsters for a Democratic Union, which has long led the anti-corruption fight in the teamsters, threw its support behind Mr. Hall after several top Carey aides endorsed Mr. Hall.

"There's a profound issue here," says Robert L. Muehlenkamp, a top Carey aide who was formerly executive vice president of Local 1199 of the National Union of Hospital and Health Care Employees in New York.

When Mr. Cuomo prepared to take office from his fellow Democrat, Mr. Carey, in late 1982, Carey aides had already prepared thick briefing books for Mr. Cuomo's transition team.