Truesee's Daily Wonder

2 former firefighters, civilian clerk charged in disability fraud scheme

October 21, 2009 01:41 PM

By Donovan Slack

Globe Staff

Two former Boston firefighters were charged by federal prosecutors today with faking career-ending injuries to receive tax-free accidental disability pensions, while a fire department personnel clerk was charged with perjury and obstruction of justice in the federal fraud investigation.

Link To Video of fire fighter competing in body building:

http://www.boston.com/video/viral_page/?/services/player/bcpid21913462001&bctid=1664436773

Former district chief James Famolare, 65, and firefighter Albert Arroyo, 47, are facing multiple counts of mail fraud for seeking accidental disability retirements from the city of Boston for allegedly bogus on-the-job injuries, prosectors said.

Arroyo claimed last spring that he fell at a Jamaica Plain firehouse and could no longer work as a fire inspector, but he continued to train as a bodybuilder and participated in a competition just six weeks later.

Famolare claimed he suffered a severe back injury when he moved a box of files at headquarters while filling in as chief of personnel for a day. But prosecutors say Famolare had to shop for a doctor to bolster his claim and witnesses to the supposed injury later recanted.

The clerk, Erika Boylan, 31, allegedly lied while testifying under oath before a federal grand jury about delaying the processing of accidental disability retirement applications.

If convicted, Famolare and Arroyo face up to 20 years in prison and fines of up to $250,000 on each count of fraud. Famolare has been charged with six counts and Arroyo faces two counts, according to the US Attorney's office. Boylan, if convicted, faces up to 15 years in prison.

Boston Fire Commissioner Roderick Fraser hailed the arrests as a step forward in his efforts to overhaul the Boston Fire Department.

"I’m glad the federal government has joined this fight," Fraser said. "We’ve been a full partner with the federal government, cooperating in the investigation. We will continue to work side by side to give taxpayers the department they deserve."

Federal prosecutors did not say whether more arrests are forthcoming in the probe.

The fraud investigation began 18 months ago and followed a series of Globe reports about disability pension fraud. The newspaper reported in January 2008 that Boston firefighters had claimed an unusual rash of career-ending injuries in recent years, sending the rate of disability retirements skyrocketing to 74 percent of all retirements -- more than twice the rate of similarly sized cities.

Between 2001 and 2007, some 167 firefighters reported career-ending injuries while on the job. A majority of them had claimed they were injured on the same day they were filling in for a supervisor, which allowed them to qualify for a pension at the higher pay rate. A state law designed to reform the pension system passed earlier this year eliminates that so-called "king-for-a-day" provision, which allowed firefighters who were filling in for superiors to receive pensions at the superiors' pay rate.

The Globe also reported that the processing of scores of disability pension applications were delayed for inordinate lengths of time, sometimes years, allowing firefighters to collect 100 percent of their salary, tax free, while they waited for their disability retirements to be approved.

The clerk indicted today, Boylan, allegedly lied to investigators while testifying under oath about participating in the delay of disability retirement applications. According to the indictment, Boylan said she never delayed them and was never asked to delay them. But the indictment said she was asked, "on at least one occasion to delay the processing of paperwork for a firefighter who had filed for accidental disability retirement."

Boylan was put on paid administrative leave today from the fire department, pending the outcome of the case.

Arroyo reported on March 21, 2008, that he had slipped on a stairway and injured his back. The incident occurred without witnesses in a firehouse where he was not assigned to work, records show. He went on injured leave and within weeks, a doctor recommended him for an accidental disability pension, saying he was "totally and permanently disabled."

But three days after his initial injury report, the indictment says, Arroyo worked out with a trainer at a Gold's Gym, and on May 3, Arroyo placed eighth in a men's bodybuilding competition, the 2008 Pro Natural American Championships. After the Globe published a video of the competition, Fraser ordered Arroyo back to work. When he didn't show, the fire commissioner fired Arroyo.

At the time, a lawyer representing Arroyo said bodybuilding was good for his back injury. But Arroyo didn't disclose the physical activity in his disability pension application submitted in June 2008, according to the indictment.

"In his application for disability retirement, Arroyo falsely stated that he had not participated in any sports or strenuous activities within the last year when in fact Arroyo had made numerous visits to various gyms during that one year period and was then training, including weight lifting, for a May 2008 body building competition," the indictment states.

Famolare claimed he suffered a career-ending back injury when moving a box of personnel files on June 18, 2006, when he was filling in for a single day as a deputy chief. He went out on injured leave at the higher pay rate, $155,000 per year, instead of his own, which was $127,000 annually.

Famolare collected the enhanced pay tax-free for more than two years while he awaited processing and approval of his disability retirement application, which would have awarded him 70 percent of the deputy chief's salary, tax free, for life. But in July 2008, his medical file was one of three that went missing from department headquarters and a witness who had signed his injury report recanted, saying he hadn't seen anything but had merely endorsed a form that Famolare asked him to sign.

Famolare abruptly withdrew his disability pension application, and asked for a regular, taxable pension instead. In a letter to the city's retirement board at the time, he said he was withdrawing his disability claim because he did not believe he could get a fair hearing.

The federal indictment says that shortly after his initial injury report, Famolare consulted with a doctor who declined to characterize his injury as so severe that he could never return to work as a fire department administrator.

"Shortly thereafter, in or about September 2006, Famolare had one visit with a second doctor ... who had never treated him before, but who had a reputation of regularly certifying total and permanent disability," the indictment says. "This second doctor immediately wrote a disability opinion after the one, short office visit with Famolare."

The indictment did not identify the doctor by name, but records show the physician is Dorchester neurologist Dr. John F. Mahoney. Mahoney is the same doctor who treated Arroyo and recommended him for accidental disability retirement.

Since 2001, Mahoney has evaluated 25 firefighters whose injuries he determined to be so severe that the city should award them accidental disability pensions, according to the records obtained last year under a public records request. A lawyer for Mahoney last year declined to comment on specific cases, but said in general, Mahoney made the best determinations he could based on information he was provided.

"Doctors don't have an obligation to independently corroborate injury," said the lawyer, Paul Cirel, citing Massachusetts court decisions regarding information provided by patients. "Doctors don't always agree on a prognosis; there is a fair amount of objectivity and there is a certain amount of subjectivity."