More Settlements Announced in NY Attorney Pension Probe

June 19, 2008 ( - Managing partners of two upstate New York law firms announced Wednesday they have settled with Attorney General Andrew M. Cuomo in his probe of alleged public pension fund abuses.

The New York Law Journal reports Girvin & Ferlazzo of Albany agreed to pay $500,000 as part of its settlement – the largest settlement so far in Cuomo’s investigation – and Hogan, Sarzynski, Lynch, Surowka & DeWind of Johnson City agreed to pay $100,000. The firms said the settlements were made because they make good business sense, and neither admitted to any wrongdoing, according to the news report.

The widespread probe is cracking down on the practice of outside lawyers being improperly classified as employees by local government agencies and improperly receiving pension credits. As part of the settlement, both law firms pledged to discontinue any arrangements in which its attorneys are classified as employees of the New York Board of Cooperative Educational Services (BOCES) or public school districts for public pension and fringe benefit purposes. Partners at both firms also agreed to give up all public pension credits accrued while doing work for school districts, the New York Law Journal said.

The firms and their partners also agreed to cooperate with Cuomo’s continuing investigation of former Girvin & Ferlazzo partner M. Cornelia Cahill and former Hogan, Sarzynski, Lynch, Surowka & DeWind partner John B. Hogan. “Both parties have agreed to cooperate against the actors who we believe were more egregious in their conduct,” Cuomo said Wednesday during a Capitol news conference, according to the news report.

Cuomo said the settlement with Girvin & Ferlazzo concerns the firm’s 19-year arrangement with the Hamilton-Fulton-Montgomery BOCES under which a total of 12 Girvin & Ferlazzo attorneys were listed as employees of the district and earned pension credits. He contends that Cahill, who has since left the firm, was among those listed as “employees” of the BOCES though she did no legal work for the district.

Hogan is alleged to have been improperly listed as an employee by as many as six school districts in addition to BOCES between 1967 and his retirement in 2000, enabling him to receive a public pension of $91,752 a year and to collect a total of more than $500,000 from the retirement system since 2000.

According to the New York Law Journal, a suit in Albany Supreme Court is seeking a cessation of Cuomo's investigation and of Comptroller Thomas P. DiNapoli's revocation of pension eligibility for lawyers. DiNapoli has removed three partners in the Johnson City firm from the pension system, and has revoked the pension fund membership of four Girvin & Ferlazzo partners.

The plaintiffs in the state Supreme Court case - Swergold v. Cuomo, 3897-08 - contend that Cuomo and DiNapoli are both overstepping their authority. James Roemer of Roemer Wallens & Mineaux in Albany, who represents Hogan in the case, is seeking to quash a subpoena Cuomo has issued to Hogan.

Maureen Harris, another former Girvin & Ferlazzo partner listed as an employee of the BOCES district, settled with Cuomo's office last month for $50,000 and forfeited any pension credits she accrued through the district (See Empire State Pension Probe Could Snare Hundreds of Lawyers ).

Earlier this month, Cuomo announced $235,000 in settlements with three law firms on Long Island, in Westchester, and in upstate New York (See NY Settles Attorney Pension Misuse Charges ).