I-Team: Convicted Public Employees May Still Get To Keep Pensions

BOSTON (CBS) — In Massachusetts, crime might pay, at least when it comes to taxpayer-funded pensions for convicted public employees.

Recommendations from a special commission would dramatically change the state’s pension forfeiture law.

Right now, it’s an “all-or-nothing” scenario: If you are a public employee and you’re convicted of a crime directly connected to your job, you forfeit your retirement benefit.

However, the commission’s report recommends only stripping pensions for felony convictions. Misdemeanors would no longer trigger forfeiture proceedings.

For employees with at least ten years of public service, the commission also recommends a tiered system where people would lose a percentage of their benefits. That calculation would be made depending on factors like the severity of the crime; the level of public trust violated; the monetary loss suffered; and any recommendation by prosecutors.

Employees with less than ten years of service would still lose their entire pensions, aside from what they had personally contributed. They would also be ineligible for joining any other state retirement system in the future.

In one other notable recommendation, employees whose primary responsibilities involve working with children would automatically have their pensions stripped when convicted of child sex crimes.

The special commission was established in the wake of a Supreme Judicial Court (SJC) ruling. In that decision, the SJC determined stripping one public employee’s pension was an “excessive fine” that violated the 8th Amendment of the U.S. Constitution.

Edward Bettencourt, a lieutenant in the Peabody Police Department, was convicted of snooping on the civil service exam scores of other officers. Bettencourt lost his job after the misdemeanor conviction, along with his pension.

The estimated value of Bettencourt’s pension over its life span was $659,000, which the SJC determined was an “excessive fine” for the misdemeanor conviction.

Over the past year, the WBZ I-Team has closely followed the pension forfeiture issue.

After exposing how a case fell through the cracks, a former Haverhill school administrator lost his $71,000 annual pension and was ordered to pay back $357,000 of benefits he’d already received.

A district court judge later reinstated Joseph Giordano’s pension, citing the “excessive fine” as the reason. The Massachusetts Teachers Retirement System is appealing the ruling in Essex Superior Court.

The I-Team also raised questions about a former Winthrop police chief who kept his pension after a federal conviction. Following the investigation, the retirement board stripped Angelo LaMonica’s pension and ordered him to repay more than $800,000.

LaMonica also later prevailed in his district court appeal, arguing his conviction for filing false tax returns was not directly related to his job as police chief. The Winthrop retirement board is currently appealing that decision in Suffolk Superior Court.

Supporters of the new legislative recommendations hailed them as a more equitable approach. The report pointed out that Massachusetts is one of the few states where public employees do not participate in Social Security.

“Members subject to pension forfeiture lose all of their guaranteed retirement income,” the report said.

However, the author of the 1988 pension forfeiture statute criticized the recommendations. Kevin Blanchette, a former lawmaker and current CEO of the Worcester Regional Retirement System, said his office has a pending case where an employee embezzled more than $300,000 from her town.

“Under this proposal, she would be eligible to receive a lifetime pension and health benefits, paid by the very taxpayers she stole from. Defies logic!” Blanchette told WBZ.

The recommendations now go to lawmakers, who will decide if they should be adopted.

Ryan Kath can be reached at rkath@cbs.com. You can follow him on Twitter or connect on Facebook.

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