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LIRR retirees' disability 'irrelevant,' prosecutor says

Peter Lesniewski, 62, of Rockville Centre is seen

Peter Lesniewski, 62, of Rockville Centre is seen walking out of the Federal Courthouse in Manhattan on Oct. 28, 2011, after an arraignment following Lesniewski's surrender earlier in the day. Credit: Craig Ruttle

The physical condition of hundreds of LIRR retirees in a federal disability fraud case is irrelevant to the guilt of three defendants who helped them file their claims, a federal prosecutor said Thursday.

The U.S. Court of Appeals Second Circuit heard oral arguments in the appeals of orthopedist Peter Lesniewski, former U.S. Railroad Retirement Board office worker Marie Baran, and former LIRR conductor and union boss Joseph Rutigliano, all convicted of fraud in a 2013 trial.

Lesniewski, accused of falsifying medical evidence for disability applicants, is serving an 8-year prison sentence. Baran and Rutigliano, who prosecutors said charged Long Island Rail Road retirees up to $1,000 each for helping them fill out disability applications, are each serving 5 years. None of the defendants appeared in the Manhattan courtroom Thursday, but several supporters did.

Among several points raised by the defendants' attorneys Thursday was the high approval rate of disability applications resubmitted by LIRR retirees who lost their original benefits in 2013 because they were examined by Lesniewski or Dr. Peter Ajemian, who pleaded guilty to fraud charges.

As reported by Newsday in November, the Retirement Board approved 91 percent of new claims by the disqualified LIRR retirees, even after subjecting them to more intense scrutiny, including exams by board-selected doctors.

In arguing his appeal before the three-judge panel, Lesniewski's attorney, John Klein, said that of dozens of new applications submitted by his client's ex-patients, "all but two have been re-approved."

"The fact of whether these people were or were not disabled is not irrelevant," Klein said. But Assistant U.S. Attorney Daniel Tehrani said the case against the defendants had nothing to do with retirees' actual physical condition, but rather that they paid Lesniewski, Rutigliano and Baran to lie on their applications.

So even if the LIRR retirees were eligible for federal disability benefits, "they still would have been convicted of fraud for submitting fraudulent applications to the RRB," Tehrani said.

The defense attorneys raised other arguments, including that the case should have been tried on Long Island and not in Manhattan, and that a five-year statute of limitations expired because some of the disability cases at issue were more than 10 years old.

Tehrani said the trial's venue was appropriate because the wire transfers of disability annuities to retirees traveled across the Southern District, which includes Manhattan. And the statute of limitations did not apply, in part, because the fraud conspiracy was extended every time a retiree involved in the scheme collected a disability payment, he said.

In addition to having helped fellow LIRR retirees falsify disability applications, Rutigliano was accused of lying about his own disability.

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