Some lawyers saw pensions as "perk of partnership"

BY EDEN LAIKIN AND SANDRA PEDDIE | eden.laikin@newsday.com; sandra.peddie@newsday.com

May 9, 2008

For lawyers of an Albany area law firm, getting a public pension for no-show jobs at a BOCES was a "perk of partnership," the head of the state investigation said yesterday.

Ellen Biben, special deputy attorney general for public integrity, said a number of lawyers of the Girvin & Ferlazzo firm cut deals with administrators at one upstate Board of Cooperative Educational Services to place partners on its payroll "regardless of whether that lawyer was doing any work."

Biben's comments came at an Albany news conference announcing the first settlements in Attorney General Andrew Cuomo's investigation into pension fraud statewide. Legal sources have said that Cuomo's office is negotiating with at least two lawyers on Long Island.

In one of the settlements announced yesterday, Maureen Harris, a former partner with the firm, agreed to pay the state $50,000. She is a member of the New York State Public Service Commission and a sister of former Gov. George Pataki's chief counsel, Mike Finnegan.

Harris' attorney, Mike Keonig, said Harris participated in the "long-standing and accepted arrangement at her firm" for only one year, in 2005, and it had nothing to do with her past or current government jobs.

In a separate action with state Comptroller Thomas DiNapoli's office, Harris agreed to forfeit the year of state pension credit she got.

In April, DiNapoli removed four of the firm's partners from the state retirement system and rescinded some pension credits for a fifth.

Calls to Girvin & Ferlazzo were not returned.

Cuomo's office also settled with a Buffalo law firm that allowed five different BOCES to improperly put 25 attorneys on the payroll so the BOCES could get more state aid. The lawyers did not get pension credits or health benefits.

That firm, Hodgson Russ Llp, agreed to pay the state $50,000 and stop the practice.

"The days of the culture of corruption are over," Cuomo said. He said the probe was prompted by Newsday's coverage of pension fraud, which began in February, but that the practice had gone on for years.

"This issue is chronic, it's widespread and it's pervasive," Cuomo said.

Harris, who started her legal career in the attorney general's office and is a board member of the Empire State Development Corp., got $30,000 in salary for the year she was listed on the BOCES payroll though she performed no work for the BOCES, Cuomo said.

His investigation is one of several into the unfolding pension scandal. The Federal Bureau of Investigation, Internal Revenue Service, the Nassau district attorney and state comptroller have launched probes.

In addition, State Education Commissioner Richard Mills sent a memorandum to BOCES superintendents statewide directing them to comply with regulations that prevent independent contractors from being treated as employees.

"Most of all," Cuomo said, "I want the practice to stop once and for all."