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LIRR disability fraud trial opens in Manhattan

Michael Constanza, 60, of Merrick, left, and Frederick

Michael Constanza, 60, of Merrick, left, and Frederick Catalano, 52, of Nesconset, exit the Federal Courthouse after the first day of jury selection in the disability fraud trial in Manhattan. (Sept. 23, 2013) Credit: Charles Eckert

A federal prosecutor accused two Long Island Rail Road retirees Tuesday of working as a firefighter and a martial arts instructor while collecting disability pensions as the second trial over an alleged massive fraud scheme began in federal court in Manhattan.

"They claimed they could no longer perform the most basic functions of daily life," Assistant U.S. Attorney Edward Imperatore said in his opening statement, pointing at defendants Michael Costanza and Frederick Catalano. "All lies. . . . They wanted to retire early and get the government to foot the bill."

Former conductor Costanza, 60, of Merrick, and crew supervisor Catalano, 52, of Nesconset, are charged with conspiracy and fraud, part of a scheme involving doctors, consultants and hundreds of retirees to make phony claims to the federal Railroad Retirement Board.

Of 33 defendants charged, 28 have pleaded guilty, and a doctor and two consultants were convicted in August. Unlike the first trial, in which the three defendants were each charged with helping dozens of retirees make bogus claims, Costanza and Catalano's trial is the first test of whether the charges will stick against individual retirees.

Defense lawyers for both men told jurors that their clients had legitimate disabilities after years of hard work on the LIRR, and should not be convicted on the basis of statistical evidence that high numbers of retirees claimed disabilities using the same doctors and consultants.

"Eighty percent of people retiring and getting disabilities doesn't mean that Mr. Costanza lied on the forms that he filled out," said Peter Tomao, Costanza's attorney.

Imperatore said that in addition to expert medical testimony, prosecutors would rely on the post-retirement activities of Costanza and Catalano -- who together collected nearly $500,000 -- to prove their claims were bogus.

Costanza, Imperatore said, claimed in his disability application that he had difficulty standing and walking, but then worked as a volunteer firefighter -- posing for a picture "wearing 40 pounds of firefighter gear and scuba tanks."

Catalano claimed difficulty bathing and walking, Imperatore said, but taught jujitsu and trained for his fifth-degree black belt after retirement, appearing in a video "flipping opponents over his shoulder, kicking and punching."

But the defense lawyers called those descriptions misleading. Tomao said Costanza had performed nonphysical duties as a volunteer firefighter.

"I don't believe you will hear any testimony that he actually entered a building or was actually involved in fighting a fire," Tomao said.Catalano's lawyer, George Dazzo, said his client's martial arts instruction was limited to teaching rape prevention classes and helping cancer and Parkinson's patients, and did not involve serious physical combat.

"The government wants you to believe that Fred is the Stephen Seagal of jujitsu," he said. "The evidence will paint a different picture, more akin to the WWF and scripted version you see in movies."


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