I-Team: Retired Firefighter Cashes In While Collecting Pension

BOSTON (CBS) - He was injured on the job, a retired firefighter too hurt to work.

But the I-Team has learned that former firefighter Paul Conway has found a way to dodge a state law that's supposed to limit how much money he can make while he collects his government disability pension.

Conway was working for the Medford Fire Department when he went out on disability after he hurt his knee back in 2000.

He collects a disability pension of about $39,000 a year, and under state law, he's still allowed to work, but can only earn an additional $24,000 a year if he wants to keep receiving that pension.

According to state officials, he's been earning a whole lot more than that.

"We believe this is an egregious abuse of the pension system," said Joseph Connarton, who heads the Public Employee Retirement Administration Commission, or PERAC, which oversees the state's 105 public pension systems.

PERAC's records show from 2004 to 2007, Conway made so much money from his business, A.C.S Roofing & Construction, that his earnings exceeded the legal limit by a staggering $948,000.

"Right now he has the best of all worlds," said Connarton. "We cannot recoup the nearly million dollars that Mr. Conway has earned. Our only responsibility is to recoup the pension benefit he received over the period of 2004 to 2007. It's about a $150,000."

Conway ignored our request for an interview and when we first tracked him down outside his house in North Reading, he immediately sped away in his pickup truck.

When we found him again a week later coming out of a local Chili's restaurant, we tried to talk to him again about the state's contention that he's an excess earner in violation of the law.

"Everything's on the up and the up," Conway said. "I have nothing to do with that." And then he drove away once again.

The state has been chasing Conway for what it says are his excess earnings for 10 years, but the retired firefighter has so far successfully argued that those big profits from his roofing business really aren't his at all.

Why? Conway claims it's because back in 2000, a few months before he applied for his disability pension from the Medford Retirement Board, he transferred his stock in the company to his wife, Debra Conway.

The Conways' roofing business now goes by the name of Hurley Brothers, but the question remains whether Paul Conway, not his wife, really runs it.

The I-Team found some evidence suggesting Conway has a key role in the business. It includes:

• Photographs taken in 2010 which show Conway on the job, inspecting roofs and supervising work.
• A bid document from last year in which the contact person listed is Paul Conway, not Debra.
• Our observations of Conway coming and going from the Hurley Brothers office on many mornings. We never saw his wife at the office.

Officials at PERAC say they believe the stock transfer to his wife is a dodge by Conway to preserve his pension, but for now the Medford Retirement Board is siding with Conway.

"The board is hamstrung with the lack of evidence that would allow us to take any other action than we did," said Michael Sacco, the attorney for the Medford Retirement Board.

"It is frustrating in that when you look at it from the outside looking in it certainly appears that Mr. Conway has a continued involvement with the business and perhaps is earning more than he's reporting," Sacco added.

Said Connarton: "This is what the American taxpayer and the taxpayer in the Commonwealth and the people in Medford rightfully should be upset about."

PERAC is still pursuing Conway's outside earnings and will soon have another chance to make its case before a government appeals board.

In the meantime, the Medford Retirement Board will continue to mail monthly pension checks to Paul Conway.