Fraud, waste or abuse hurts the System, its members, retirees, beneficiaries and ultimately the taxpayer.
NYSTRS is proactive in combating fraud by providing various ways for those with information to report suspected fraud, waste or abuse affecting the System. The following are helpful tips for reporting fraud.
1. What types of incidents should be reported?
The following is a partial list:
- Any dishonest or fraudulent act that hurts the System.
- Any intentional deceptive practice designed to improperly inflate a member's pension benefit.
- Intentional salary spiking during the final three to five years of employment prior to retirement.
- Contractual agreements intended to inflate a member's salary prior to retirement.
- Mischaracterization of non-regular compensation as base salary.
- Salary giveback schemes intended to inflate earnings for pension calculation purposes.
- Intentional misreporting of service credit.
- Improper enrollment of consultants or independent contractors (e.g., school attorneys) as members for service credit purposes.
- Earnings after retirement abuses.
- Improper school district approval of a prior service credit request.
- Misappropriation of System funds, securities, supplies, property, equipment or other assets.
- Questionable accounting or operating practices.
- Fraud committed by vendors doing business with NYSTRS.
- Fraud committed by investment managers hired by NYSTRS to manage a portion of the System's assets.
- Disclosure of confidential and proprietary information to unauthorized parties.
- Forgery, alteration or falsification of records.
- Intentionally falsifying retirement information.
- Falsely claiming a disability retirement.
- Theft or misuse of personally identifiable information for NYSTRS members and retirees.
- Continuing to receive retirement benefits of a deceased member.
2. What information should I report to help NYSTRS conduct a thorough investigation?
The following information would be helpful:
- Who was/is involved?
- What type of activity is taking place?
- When did the activity or incident take place? Is it still going on?
- Where is the activity taking place?
- Why is the activity being done?
- How is the activity being carried out? (Please describe the activity in as much detail as you can provide.)
- How to contact you if you wish to assist with the investigation.
3. Can I file a report anonymously?
Yes. You may choose not to identify yourself when filing a complaint. On the contrary, if you choose to identify yourself, NYSTRS will make every attempt to maintain your confidentiality. In some cases, however, the System may be required to turn over information under the Freedom of Information Law (FOIL), or to other authorities, such as law enforcement, should the matter escalate.
4. Who may file a report?
Anyone with knowledge of any wrongdoing concerning the Retirement System may file a report. This includes, but is not limited to, System employees, teachers and other school district employees, vendors and citizens.
5. Do any specific laws pertain to this?
Yes. Section 525 of the Education Law addresses fraud and the correction of errors:
§525. Protection against fraud.
- Any person who shall knowingly make any false statement, or shall falsify or permit to be falsified any record or records of this retirement system in any attempt to defraud such system as a result of such act, shall be guilty of a misdemeanor, and shall be punishable therefore under the laws of the state of New York.
- Any violation of subdivision one of this section that results in a member or beneficiary of the retirement system receiving a benefit or payment in excess of one thousand dollars more than he or she would have been entitled to shall be a class E felony. Any violation of subdivision one of this section that results in a member or beneficiary of the retirement system to receive a benefit or payment in excess of three thousand dollars more than he or she would have been entitled to shall be a class D felony.
- Should any change or error in records result in any employee or beneficiary receiving from the retirement system more or less than he would have been entitled to receive had the records been correct, then, on the discovery of any such error, the retirement board shall correct such error, and, as far as practicable, shall adjust the payments in such a manner that the actuarial equivalent of the benefit to which he was correctly entitled shall be paid. [Amended L. 2008, ch. 640 in effect October 7, 2008.]
6. Are there other places to report fraud, waste or abuse if my complaint is beyond the scope of the Retirement System?
Yes. The following agencies also have fraud, waste and abuse reporting mechanisms.