NJ's Disabled Repo Cop Loses His Pension

TRENTON – Joe Derrico, the disabled New Jersey cop turned roughhousing repo man on reality TV, took a hard punch Monday from a state pension board.

The board stripped Derrico of his $69,703 a year tax-free disability pension and declared him fit to return to work for the HamiltonTownship police.  The action was sparked by an investigative report by NewJerseyWatchdog and NBC 4 New York two months ago.

“We had to stop his pension,” said Police and Firemen’s Retirement System  board member John Sierchio. “Otherwise, this would go on in limbo forever. And he would be collecting a pension, not being disabled and pretty much laughing at everybody.”

Whether Hamilton wants Derrico back is another matter. At the time he retired in 2010, Derrico was under indictment on a felony charge of theft by receiving stolen property.

In a secretive deal, Mercer County Prosecutor Joseph Bocchini dropped the case after Derrico agreed to leave the Hamilton police and not seek re-employment there. As part of the bargain, the township also agreed to drop misconduct charges against Derrico.  If he had been convicted or fired, Derrico could have lost his pension under state rules.

“In my opinion, if the prosecutor would have done his job, there wouldn’t be an issue here,” Sierchio said. “Your report caught them and now everybody has egg on their faces.”

Derrico’s disability pension was based on his claim he could no longer work as a patrolman because he had twice injured his leg while making arrests.

One year after retiring, Derrico was brawling on television as a cast member of “Bear Swamp Recovery”,  a truTV cable network reality show on vehicle repossessions by the “baddest towing team in Jersey.”

During the “Monster Truck Showdown” episode, Derrico runs after a truck, pulls a man down from the driver’s seat, throws him to the ground and climbs into the cab. In another scene, Derrico is wrestling with opponents.

“Everything that you saw was all fake,” Derrico’s close friend and fellow cast member, P.J. Vinch, told NBC 4′s Chris Glorioso. “It was all staged. Nobody was exerting any physical activity. Nobody was actually fighting; it was mocked for TV.”

Yet it was real enough for the Police and Firemen’s Retirement System’s Board of Trustees and the state’s medical experts to determine Derrico is no longer disabled.

What will happen next in the Derrico saga is unclear.

Derrico may appeal the decision to the Office of Administrative Law, a process that could take months or even years. Depending on the outcome, Hamilton Township could be forced to rehire a cop with a troubled history. Or PFRS could get stuck paying $5,808 a month in disability checks to someone deemed not disabled.

“As far as we’re concerned, he’s no longer a Hamilton police officer and has no rights to be re-employed,” said John Ricci, township administrator.

Derrico did not attend the pension board meeting and could not be reached for comment.

“I’m sure this is going to wind up in court,” Sierchio said.

The Derrico controversy began April 13, 2010, with a burglary at a residence in Hamilton Township, a suburb of Trenton.

Three youths stole jewelry valued at several thousand dollars. Their next stop was Hiram’s Gold & Coin Exchange LLC, a Ewing Township enterprise dealing in precious metals and gems. The business was similar to a pawn shop, but did not offer collateralized loans.

Derrico moonlighted as a manager and co-owner at Hiram’s. According to state records, he was a principal in Hiram’s when the business formed in 2009. And the off-duty officer was behind the counter when the youths brought their loot to the store on North Olden Avenue.

Few questions asked, Derrico paid them roughly $1,000 for the whole bag of jewelry, one of the youths later told police.

The day after the burglary, police investigators went to Hiram’s to inquire about the stolen property. Derrico denied the youths had been at his store or that he bought anything from them.

Unknown to Derrico, the store had been under surveillance by Ewing police, who suspected burglars were using Hiram’s to fence stolen property, according to documents obtained by New Jersey Watchdog.

Confronted by photos of the youths entering the store, Derrico changed his story. Some of the jewelry was subsequently recovered – but not a platinum ring with a one-karat diamond valued at $5,500, according to the burglary victims.

The Mercer County Prosecutor’s Office and Hamilton Township began an internal investigation. The following month, Derrico was indefinitely suspended from his police job. The administrative charges against him included misconduct and untruthfulness.

A grand jury subsequently indicted Derrico July 14, 2010, on a charge of third-degree theft by receiving stolen property, an offense punishable by up to five years in prison.

Derrico already had been planning to leave the Hamilton Police Deparatment, but under a completely different circumstance.

One month before the burglary, Derrico applied for accidental disability retirement – an especially generous type of pension that would pay him two-thirds of his $104,555 annual salary, tax-free, for the rest of his life.

Derrico told authorities his leg was injured while apprehending suspects on July 31, 2009, and again on Jan. 16, 2010. The incidents were detailed in his state pension file, obtained by New Jersey Watchdog under the Open Public Records Act.

Following the first scuffle, Derrico stated “my left leg felt like rubber and felt like it was asleep.” Six months later, the officer reported “my left leg gave out on me” when he tried to arrest a suspect at a house party.

“I feel my injury will prohibit me from doing my job safely and at the level needed, it will put me or other officers in danger,” Derrico concluded.

Details about Derrico’s diagnosis, treatment and disability evaluation were omitted from the records released by the state Treasury’s Division of Pensions and Benefits. The agency determined those documents are exempt from public disclosure.

Disability retirements are epidemic in New Jersey, where 5,447 former police and fire officials collected $196 million from state pension coffers last year, according to state Treasury data. Nearly one in five PFRS retirees receive disability pay.

“It’s astronomical – that’s crazy,” said Sierchio, a Bloomfield police detective. “Almost 20 percent of our membership retires on disability. The other 80 percent are still working, paying the bills for these guys.”

There is a strong economic incentive for police officials to make suspicious and possibly fraudulent claims, but the state does little or nothing to stop the abuses, Sierchio said.

“The State of New Jersey has an $80 billion pension system, and we have zero investigators,” he said. “We have nobody watching our money.”

The secret seal

Disabled or not, Derrico’s grand jury indictment threatened his plans to start collecting a pension at age 43.

“The receipt of retirement benefits is expressly conditioned upon the rendering of honorable service by a public officer or employee,” states the PFRS handbook. “Your benefits may be reduced or forfeited if you are convicted of a crime in any way related to your employment, or if you are suspended or dismissed from your employment.”

Fortunately for Derrico, PFRS did not find out about the indictment until after his pension was approved.

The Mercer County Prosecutor’s Office ignored a state law that requires it to report indictments of public employees to the Division of Criminal Justice.

“We did not receive any notification of an indictment on Derrico,” DCJ spokesman Peter Aseltine told New Jersey Watchdog.

As a result, DCJ was unable to pass along the information to pension authorities.

“We had no idea he was under indictment,” said Sierchio, chair of the pension board when Derrico’s retirement was granted on Sept. 9, 2010.

He said it would not have been approved if the trustees had known.

Derrico used his status as a retiree to convince the Mercer County prosecutor to dismiss the indictment and Hamilton to end its disciplinary procedures. All charges against Derrico were dropped on Sept. 23, 2010.

By the time pension officials finally learned about the case against Derrico, it was too late.

“If the indictment is dropped and there are no charges, we can’t hold the gentleman responsible for anything,” Sierchio said. “The prosecutor cut a deal for whatever reason, and now the taxpayers and pension system are paying the bill. The township cut a deal to get the officer off the job, so taxpayers and the pension system are paying the bill.”

Derrico’s disability did not stop him from becoming a rough-and-tumble character on reality television.

Vinch, his associate at Hiram’s, had another business venture – a repo service called Bear Swamp Recovery. In 2011, it became the focus of a reality show bearing the same name.

The program featured Vinch and Derrico as members of a repo crew, seizing vehicles from debtors in confrontational situations. It lasted for a season of 13 episodes on truTV, a cable network of Turner Broadcasting, a subsidiary of Time Warner.

The show debuted the year after Derrico received his first monthly disability pension check from New Jersey.

“He’s a model citizen; he really and truly is,” said Vinch in Derrico’s defense. “To even think he would do something that’s not above board is disgraceful.”

Meanwhile, a bill that would create a unit to investigate pension fraud has languished in the state Legislature for the past year.

The proposed reform – S-1913 in the Senate and A-3074 in the Assembly – also would tighten up the qualifications for disability retirements. In both chambers, the reform has been stuck in committees.

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