Since taking office, New York State Comptroller Thomas P. DiNapoli has battled public corruption. One of his top priorities is to protect the New York State and Local Retirement System (NYSLRS) from pension scammers.
Under the direction of Comptroller DiNapoli, NYSLRS has put in place a system of safeguards designed to prevent and identify potential incidents of pension fraud. One such safeguard uses data analytics to uncover and stop improper payments.
Post-Retirement Employment Violations
Our investigative efforts include a focus on post-retirement employment. New York State law restricts the amount of money public sector retirees can earn if they return to public service employment after retirement. The law permits public sector retirees under the age of 65 to earn up to $30,000 per year from public employment before their pension benefits are suspended.
As of this March, our review of post-retirement employment cases have uncovered more than $700,000 in benefit payments subject to recovery. For example, a former Newburgh City Fire Chief, who double-dipped by collecting $95,000 in pension payments while still working as fire chief, was federally convicted.
The “Muscle” in the Pension Fraud Fight
In some cases, the pension fraud NYSLRS uncovers gets referred to Comptroller DiNapoli’s wider umbrella program to root out public corruption and fraud involving public funds. The Comptroller’s aggressive initiative included partnering with federal, state and local prosecutors and law enforcement statewide, including DiNapoli’s groundbreaking “Operation Integrity” task force with Attorney General Schneiderman. To date, Comptroller DiNapoli’s various partnerships have garnered more than 130 arrests and $30 million in ordered recoveries.
NYSLRS’ partnership with DiNapoli’s “Operation Integrity” has resulted in the investigation, prosecution and recovery of stolen pension payments, exposing $2.75 million in pension fraud in recent years.
Here are some recent cases where pension scammers have been thwarted:
- A 71-year-old Florida man was convicted of grand larceny after it was discovered he stole $180,000 in NYSLRS pension benefits by impersonating his dead brother.
- A 67-year-old South Carolina man concocted a scheme to steal a deceased New York State employee’s pension checks. He was arrested for conspiracy to commit wire fraud, which carries a maximum sentence of 20 years in prison.
- A 66-year-old Arizona man was convicted of grand larceny for stealing his late mother’s pension. He was sentenced to five years probation and ordered to pay back over $131,000.
- A 70-year-old Florida man was sentenced to five months in jail for stealing nearly $275,000 in pension benefits.
Comptroller DiNapoli and NYSLRS will not tolerate pension fraud. These arrests and convictions serve as warnings to those who might steal pension benefits: if you think you can steal the hard-earned benefits of NYSLRS members and retirees, you are gravely mistaken. When fraud is identified, Comptroller DiNapoli will work with law enforcement to hold the pension scammers accountable. The clear message to anyone who tries to defraud our pension system is that you will be found, and you will pay.
If you suspect someone of pension fraud, call the Comptroller’s toll-free Fraud Hotline at 1-888-672-4555, file a complaint online at email@example.com, or mail a complaint to: Office of the State Comptroller, Division of Investigations, 14th Floor, 110 State St., Albany, NY 12236.