Thursday, October 27, 2011

Another LIRR Pension Scandal Brewing

It's been a few years since the last pension scandal at the LIRR, but it seems that whatever procedures were put in place to prevent abuse of the pension system were insufficient. 10 people were arrested in connection with the latest pension scam. This investigation grew out of the original 2008 scandal, as federal investigators dug deep to find out what was going on.
The United States attorney in Manhattan, Preet Bharara, and the head of the New York F.B.I. office, Janice K. Fedarcyk, were expected to announce the charges at a news conference with two inspectors general, Barry L. Kluger of the Metropolitan Transportation Authority, and Martin J. Dickman from the Retirement Board. The investigation was conducted by the F.B.I. and federal prosecutors in Manhattan, along with the inspectors general of the federal Railroad Retirement Board and the Metropolitan Transportation Authority, the Long Island Rail Road’s parent agency, the people said.

The Times articles reported that virtually every career employee of the railroad was applying for and receiving disability payments, giving the Long Island Rail Road a disability rate of three to four times that of the average railroad. The Times found that retired railroad employees who had successfully claimed disability were regularly playing golf at a state-owned course without charge — another perquisite of their disability.

Indeed, the railroad’s retirement rate was particularly striking when compared with the number of disability pensions at Metro-North, another transportation authority subsidiary that serves commuters north of New York City and has a work force of similar size and composition.

The articles revealed that a web of doctors and facilitators were helping the workers file papers claiming they were disabled.

The authorities estimate that the cost to the Railroad Retirement Board of disability claims by Long Island Rail Road retirees was $1 billion, the people briefed on the case said.
Turns out that this was a billion dollar scandal.

Think about what a billion dollars could do for the LIRR. That's a one followed by nine zeroes. 1,000,000,000.

It could buy a solvent pension system that does what it was intended to do by servicing all eligible employees in a fair and just manner.

It could buy hundreds of railcars.

It could upgrade signal and rail systems.

It could renovate stations throughout the system to bring them up to modern standards.

Instead, it's a billion dollars that was siphoned silently from the system and commuters and taxpayers paid for it.

Now, investigators have to attempt to claw back the ill-gotten gains and take criminal actions against all those involved. It means that the agency will likely get back only a fraction of that amount, but it's still better than nothing. LIRR commuters deserve as much; they deserve a chance to recoup these costs from these defendants.


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