While the state Division of Pensions and Benefits (DPB) has saved $59 million to date by removing ineligible individuals from pension rolls, hundreds of cases remain unresolved, according to a report released today by Acting State Comptroller Kevin Walsh.
The Office of the State Comptroller (OSC)’s report found that DPB is still working through a backlog of 241 investigations into professional service providers which are suspected of being improperly enrolled in the pension system.
“DPB has made significant progress in ridding the pension system of abuse and enforcing state law, but challenges and inefficiencies remain,” Walsh said. “At the current pace, there is no end in sight. The State will do a better job protecting pension funds if we find ways to clear the backlog faster and if the Legislature gives DPB the powers it needs to more aggressively identify abuses of the pension fund.”
The OSC’s investigation is a continuation of an investigation first made public in 2012, which found that most municipalities and school districts across the state were violating state pension law and costing the state millions of dollars. Today’s report noted that DPB has made significant improvements since then, at least in part because of its newly created fraud and abuse unit, but that there is still more work to be done.
“There is more money to be saved here,” Walsh said. “Allowing independent contractors to draw down pension benefits drains New Jersey’s pension system and requires taxpayers to pay a pension to someone who never should have been in the pension system to begin with.”
In a statement, the Department of the Treasury thanked OSC for its investigation, and said that DPB’s fraud and abuse unit will continue working to save money.
“We appreciate the Comptroller’s thorough review of the matter and the recommendations they have put forth to further empower the Division of Pension and Benefits in their continued mission to prevent fraud and abuses,” said Jennifer Sciortino, a spokesperson for the department. “We will continue to work with the Division and the Legislature, as necessary, to ensure that the Pension Fraud and Abuse Unit has the resources necessary to investigate unauthorized benefits and protect taxpayer dollars.”
This story was updated at 6:26 p.m. with a statement from the Treasury Department.2021110_Pensions_Report_FINAL v3