N. Babylon Man Pleads Guility in LIRR Fraud, Faces 55 Years in Prison

A North Babylon man pleaded guilty in federal court Monday to charges related to the allegedly massive fraud scheme in which Long Island Rail Road workers claimed to be disabled upon early retirement so that they could receive disability benefits to which they were not entitled, according to a press release from the U.S. Department of Justice.

Steven Gagliano, a former LIRR signalman, pleaded guilty to one count of conspiracy to commit mail fraud, wire fraud, and health care fraud; one count of conspiracy to defraud the United States and the U.S. Railroad Retirement Board (RSB); one count of health care fraud; and one count of wire fraud. The 55-year-old faces a maximum sentence of 55 years in prison, and has agreed to make restitution to the RRB in the amount of $242,466.73.

According to the indictment against Gagliano, he retired on a LIRR pension in 2006. He then applied for and received disability benefits from the RSB after falsely claiming he was unable to do his job because of "severe and disabling pain" in his back shoulder and legs. "Nevertheless, in 2009, Gagliano successfully completed a 400-mile bike tour in northern New York," the indictment reads. 

Thirty-two people have been charged in connection with the LIRR disability fraud scheme, 24 of whom have now pleaded guilty, according to the press release.