In the wake of the state comptroller's decision to return all pension benefits to private attorneys who improperly received them, the state attorney general's office said Tuesday it is reviewing all the cases for potential fraud.
"We will continue to review the fact of their individual cases to determine whether action by this office is warranted," said John Milgrim, a spokesman for the office.
At the same time, a high-ranking official in the comptroller's office said the office helped craft a proposed settlement with the attorney general's office regarding Lawrence Reich. He is the attorney who sparked multiple investigations last year after Newsday reported he was carried as a full-time employee of five school districts simultaneously, while also collecting millions in retainer fees, in order to secure public benefits. The comptroller revoked his pension and then restored it after recent court rulings.
After Newsday stories on pension abuses last year, Comptroller Thomas DiNapoli revoked pensions or rescinded pension credits of 62 people. But two attorneys, including Valley Stream attorney Albert D'Agostino, filed lawsuits.
In back-to-back rulings in August and September, Albany Supreme Court Justice Gerald Connolly found the attorneys had not been given adequate due process. He ordered their benefits restored, but held open the possibility that they could be revoked again with adequate due process.
As a result, the comptroller is restoring annual pensions worth nearly $500,000 to 13 attorneys and years of pension credits to the rest. Comptroller spokesman Dennis Tompkins said he was confident the office would recover all the money after holding hearings. But others familiar with some of the comptroller's actions said there were problems not merely with procedure, but with the facts in some cases, as well.
Settlements worth more than $1.7 million negotiated by Attorney General Andrew Cuomo are not affected by the court rulings because the attorneys gave up their claims to any pensions.
The news of a possible settlement in Reich's case comes even as the comptroller restored his annual pension of $61,596 and repaid him $92,394.72.
Reich's attorney, Peter Tomao of Garden City, would not confirm or deny any settlement but said, "Cases that have to do with money can always be settled to avoid litigation risks."
Both Tompkins and Milgrim declined to comment on any potential settlements, but sources familiar with the discussions said Reich would return $180,000 to the state retirement system and pay a $60,000 penalty. Because he previously worked at the state Education Department, he is entitled to a smaller pension of $4,575 a year, according to records.