Mary Altaffer/AP
The Long Island Rail Road ticket counter
at Penn Station, New York.

Probe of LIRR Disability Payments Results in Criminal Charges

November 19, 2008 05:00 PM
by Emily Coakley
As an investigation into allegations that millions of dollars were illegally paid to retiring LIRR workers continues, one railroad official has been arrested.

Official Charged With One Felony, One Misdemeanor

Frederick Kreuder, who has been with the railroad for more than 20 years, was charged Tuesday with “receiving a reward for official misconduct, a felony, and official misconduct, a misdemeanor,” Newsday reported.

According to Newsday, Andrew Cuomo, New York’s attorney general, said on Tuesday, “Today’s arrest is the first time that someone is being held accountable for the culture of entitlement and systemic abuse that plagued the LIRR and Railroad Retirement Board.”

WCBS reported that Kreuder may not be the only one to face charges, as there are four investigations ongoing. All but 10 percent of retiring LIRR workers applied for disability benefits, and only 2 percent of those applying were denied, the station said.

Cuomo’s office has accused Kreuder of taking $1,000 from an unnamed employee in exchange for helping that person obtain benefits. Part of the money went to a baseball team for teens Kreuder coached. He also allegedly referred the employee to a doctor that would supply the necessary papers.

His attorney, William Petrillo, said, “[W]hen the entire story comes out, specifically what happens at the railroad and more importantly what doesn’t happen, it will be clear how heartbreaking today is,” WCBS reported.

Kreuder was released after pleading not guilty, and could face up to four years in prison if convicted. On Tuesday, he was also suspended from his job without pay, Newsday said.

Opinion & Analysis: Arrest welcomed

On the site Transit Blog, an author known only as “Transit Blogger” was pleased to hear the news of Kreuder’s arrest.

“I am really glad to see the first of what I can only hope will be many casualties. The people who participated in this scam should face the stiffest punishment possible under our current laws,” the writer said.

A Newsday editorial said Kreuder’s case was minor, “but an important one if it sends the large message that our permanent government can’t ignore a culture of corruption in its ranks.”

If Kreuder is ultimately found to be guilty of the charges, the case would also show, “something can be wrong and illegal, even if everybody does it,” the editorial said.

Related Topic: Abusing sick leave

A doctor recently testified before a panel that he filled out false reports for LIRR workers who paid him $750. He was among many doctors who have recently come under fire around the world for allegedly helping people abuse sick leave.

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