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Comptroller: Attorneys Owe New York $700,000 in Pensions
New York Law Journal
August 28, 2008
Two Long Island, N.Y., attorneys who were improperly listed as employees by government agencies they advised owe the state close to $700,000 in pension funds, New York Comptroller Thomas P. DiNapoli said Wednesday.
DiNapoli said Albert D'Agostino, of Minerva & D'Agostino in Valley Stream, N.Y., must repay the retirement system $605,874 for payments made to him from August 2002 through March 2008. Lawrence W. Reich, formerly with Ingerman Smith in Hauppauge, N.Y., owes $83,624.
In a press release, DiNapoli called the actions of Reich and D'Agostino "the most egregious examples" uncovered so far in the comptroller's probe of excess pension payments.
They must return "every dime" owed to the pension fund, he said.
The comptroller's office has now revoked pension fund membership or retirement service credit for 33 lawyers.
D'Agostino was listed as an employee by the school districts of Valley Stream, Lawrence and North Merrick as well as the Nassau County Planning Commission for periods ranging from 23 years to three years. All four agencies reported him for the final three years before he retired, according to the comptroller.
D'Agostino, who was receiving an annual pension of $106,000 until it was suspended in March, vowed to fight the comptroller's action.
"I don't owe the pension system any money," said Agostino, who still practices law. "I earned the money, and I'm going to keep it."
He said Wednesday that he had provided "voluminous documentation" to the comptroller of his employment status and would "fully defend my rights."
D'Agostino, 64, said that in 2000 he had requested retroactive credit for the 21 years he had worked two days a week for the planning commission. During that time, he said that he had "a desk, a phone, business cards and could bind the county."
The request was approved at "several levels" in the office of then-Comptroller Carl McCall, he said.
"They could have turned it down, but they didn't," he said.
D'Agostino said that he had been hired as counsel to the school district, which he described as a civil service position.
The attorney said that he had received a letter from DiNapoli directing him to repay the contested pension money within 30 days; he has four months to appeal the decision to an administrative hearing officer.
In his press release, DiNapoli said that six school districts had incorrectly listed Reich as an employee. According to Newsday, Reich had been receiving a $62,000 annual pension. With rescinded service excluded, that has been recalculated as $4,575, DiNapoli said.
Peter J. Tomao, who represents Reich, said in an interview that his client was re-evaluating his options and that his position remains that "everything was legal."
The comptroller also said he has revoked the pension fund membership of three other lawyers: Deveraux Cannick and Jennifer Fremgen of Aiello & Cannick, and Marc Reitz of Ferrara, Fiorenza, Larrison, Barrett & Reitz.
An investigation determined that the Mount Vernon Central School District in Westchester County had reported Cannick and Fremgen as employees since 1997.
The attorneys, with the Maspeth, N.Y., firm Aiello & Cannick, were actually independent contractors, according to the comptroller. The erroneous listing allowed them to earn 8.75 years of service credit.
Reitz was incorrectly reported as an employee by the Madison-Oneida Board of Cooperative Educational services for two years, according to the comptroller.
In addition, DiNapoli said he has rescinded the service credit of attorneys Henry Sobota and Norman Gross, who were independent contractors to the same board, rather than employees.
Gross owes the state $26,928 for excess pension payments made from August 2002 to July 2008, according to the comptroller.
The board did not supervise the work of Sobota, Reitz and Gross, DiNapoli said, adding that the attorneys did not have set hours or offices at the board.
Sobota and Gross are also attorneys at the East Syracuse, N.Y., firm Ferrara, Fiorenza, Larrison, Barrett & Reitz.
In an e-mail message Benjamin J. Ferrara, the name partner in the firm, called DiNapoli's press release "totally misleading." He said that the attorneys had "voluntarily renounced any and all reported service credits" as part of a settlement with Attorney General Andrew Cuomo's office.
"The implication of the Comptroller's press release ... is that his office is now, for the first time, taking action to strip the three attorneys of certain pension credits," he wrote, adding that the pension credits "were never sought in the first place."
Cuomo also has reached a settlement with Aiello & Cannick, the comptroller said.
