Attorney General Cuomo Announces That A Capital Region Lawyer Will Pay $270,000 To Settle Pension Abuse Case

ALBANY, N.Y. (October 16, 2008) – Attorney General Andrew M. Cuomo today announced a settlement agreement with a Capital Region lawyer who was improperly listed as an employee at Troy Central Schools and received approximately $250,000 in public pension payments he was not entitled to.

Under the settlement, lawyer E. Michael Ruberti, a former partner at the Albany law firm now known as Girvin & Ferlazzo, P.C., will pay the state and the state Common Retirement Fund a total $270,000. With this settlement, more than $1.5 million is being returned to taxpayers due to Attorney General Cuomo’s ongoing pension fraud investigation.

From 1991 to 1995, Ruberti was listed as an employee of the Troy Central Schools and accrued public pension benefits in connection with that purported employment.  However, for that entire period, he provided services to the Troy Central Schools as an independent contractor, i.e., as outside retained counsel, and was not entitled to accrue state pension credits for that work. 

“Abuses of the state public pension system have cost taxpayers millions of dollars, and there is no excuse,” said Attorney General Cuomo. “This is more evidence of the pervasive fraud fueled by greed. My office will continue to root out those who cheat the public pension system and fight to restore trust and integrity in public service.”

Between 1978 and 1995, Ruberti was also listed as a “Labor Relations Specialist” at the Hamilton-Fulton-Montgomery Board of Cooperative Educational Services (HFM BOCES), where he accrued additional pension credits.  During a significant portion of that 18-year period, Ruberti was also employed full-time by two independent law firms, including the Girvin firm.  Although other lawyers at the Girvin firm were improperly listed as HFM BOCES employees for the purpose of collecting state pension benefits to which they were not entitled, Ruberti maintained sufficient indicia of employment at HFM BOCES to have been properly classified as an employee.

Since his retirement, Ruberti has received a total of more than $657,500 in pension payments, of which approximately $250,000 was excess due to his improper classification with Troy Central Schools.

Attorney General Cuomo’s ongoing statewide investigation of pension abuse includes more than 4,000 local governments and special districts across New York State, all school districts and the 37 Boards of Cooperative Educational Services (“BOCES”).  The investigation has already revealed that many lawyers had improperly remained on public payrolls for such extended periods of time, or were included on the payrolls of so many public sector employers simultaneously, that they accumulated substantial credits in the New York State pension system. 

Attorney General Cuomo’s investigation also led to legislation – signed into law last week – that increases government accountability at all levels, curbs fraud and abuse in the state retirement system with tough new penalties, closes “double dipping” loopholes for retirees and increases transparency and accountability in school spending plans.

To date, Attorney General Cuomo’s investigation into fraud and abuse in the public pension systems has returned more than $1.5 million to taxpayers through actions involving the conduct of more than 65 attorneys. Of that, $1.125 million was from the Girvin firm and lawyers presently or formerly connected to it.

In May, the Attorney General announced settlements with the Buffalo firm of Hodgson Russ LLP and Capital Region attorney Maureen Harris, a former partner with the Girvin firm and a commissioner with the state Public Service Commission. Those settlements ended improper employment arrangements with school districts and various BOCES and rescinded all public benefits the lawyers had wrongfully received.  The Hodgson firm and Harris each paid $50,000 under the settlements

Three law firms and lawyers (the Central New York firm of Ferrara, Fiorenza, Larrison, Barrett and Reitz P.C., the New York City firm of Aiello and Cannick and Long Island attorney Gilbert Henoch) settled allegations in June ending improper employment arrangements with school districts and a Central New York Board of Cooperative Educational Services (“BOCES”).  The settlements also rescinded all public benefits wrongfully received and required the law firms and lawyers to pay the state a total $235,000.

More recently, the Attorney General reached settlement agreements with two law firms and their partners ending decades of abuse of the public pension system and calling for payments to the state totaling $600,000.  Under those settlements, the Girvin firm paid the state $500,000 and the Binghamton law firm Hogan, Sarzynski, Lynch, Surowka & DeWind LLP paid $100,000.

Last week, former Girvin firm lawyers M. Cornelia Cahill and John R. Sise, agreed to pay a total $305,000 to settle allegations that they were improperly listed as employees at an upstate BOCES for which neither actually worked.

The Attorney General’s Office urges individuals with knowledge of any questionable arrangements between any BOCES, local governments, or school districts and their outside professionals to contact the Public Integrity Bureau by telephone at 212-416-8090 or by e-mail at public.integrity@ag.ny.gov.

The settlement announced today was handled by Assistant Attorney General Darcy M. Goddard.

 

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