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I-Team Exclusive: Loophole Allows Tax Dollars To Fund Convicted Criminals' Pensions

By Charlotte Huffman

PHILADELPHIA (CBS) – Your tax dollars are funding the pensions of convicted criminals.

Investigative reporter Charlotte Huffman exposes how crime sometimes pays with state pensions in this exclusive report.

Frederick Lange is a former employee of the Bensalem Township School District.

He was among more than a dozen people arrested 2 years ago for stealing from the district.

"Some authorities have called you the mastermind of that theft ring," said Huffman.

"Yeah I know," Lange told her. "I just happen to be in charge of the department it happened in."

Lange worked at Bensalem's bus garage where authorities said he stole and resold $400,000 worth of tires and auto supplies.

He pleaded guilty and lost his job but was entitled to keep his full pension.

Four other convicted Bensalem employees are also eligible to collect their full pensions.

While some people might say it's not right for the general public to have to fund the pensions for criminals it is perfectly legal.

In Pennsylvania, if a public employee is convicted of a crime connected to their job they can be stripped of the taxpayer-funded portion of their pension.

But some crimes like aggravated assault, sexual abuse of a child, possession of child pornography and theft by unlawful taking are not covered.

These crimes allow the criminals to keep their full pensions and allow them to collect from a system that's $53 billion in debt.

State Representative Scott Petri from Bucks County says its too easy to get around the law.

"Defense lawyers who are gaming the system, they make a deal with the prosecutor 'my client keeps his pension because I'm not going to plead to something on the list'", as Petri described a legal loophole saying it's a waste of taxpayer money.

"And those loopholes, the way they're being played right now, you could drive a tractor-trailer through that hole," he said.

So he's introduced a bill that expands the scope of the pension forfeiture law to include any felony committed in connection with a state job.

In Lange's case, he was convicted of "theft by unlawful taking".

"Personal opinion, I think no matter what you did, you pay restitution, you should be entitled to the money you put into it," Lange told Huffman.

When asked if he should be entitled to the state funded portion of his pension Lange said that part was questionable.

Lange spent 15 months in jail and was ordered to pay $125,000 in restitution.

He still owes $103,000 and is eligible to start receiving his full pension.


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