By Mark Lagerkvist
New Jersey Watchdog

New
Jersey Gov. Chris Christie — a rising star in the national Republican
Party — called an overhaul of the state pension system his "biggest
governmental victory." He now faces embarrassment from flaws his reforms
failed to fix.
Follow @msnbc_usThe sweeping new laws increase contributions from public workers, decrease benefits and halt cost-of-living hikes. According to Christie, the changes should save the state $120 billion over the next 30 years.

But
his reform did little to stop the age-old New Jersey practice of
double-dipping, in which employees "retire," start collecting a pension,
and then are rehired, often the next day. Christie's own deputy chief
of staff collects $219,000 a year from the state — a $130,000 salary as a top aide to the governor plus $89,000 in state pension.



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Worse for Christie, a criminal investigation is under way involving his running mate, New Jersey Lt. Gov. Kim Guadagno.




As a county sheriff in 2008, Guadagno made false statements
to enable her chief officer to pocket nearly $85,000 a year in
retirement pay while drawing an $87,500 annual salary. The
double-dipping scheme first was reported by New Jersey Watchdog in 2010.The
state's investigation is assigned to the Attorney's General's Division
of Criminal Justice, a unit where Guadagno once served as deputy
director. Despite the apparent conflict, Christie has not appointed a
special prosecutor.A spokesman for Christie and Guadagno declined to comment. The Attorney General's Office did not respond to questions.

Pension abuses are so rampant in New Jersey that even the agency investigating Guadagno has its own controversy.

Twenty-three
supervisors and investigators for the Attorney General’s Office and DCJ
are using legal loopholes to draw salaries and pension pay, New Jersey Watchdog found. On average, each pockets $164,000 a year — $96,000 in salary and $68,000 in pension.Most
"retired" for just one night. Those officers left their positions with
the Attorney General’s Office only to return to the same employer the
next morning with new job titles — and two paychecks instead of one.In a continuing series of investigative reports, New Jersey Watchdog exposed similar double-dipping practices involving 125 officers employed by prosecutors, 18 officials from a state Homeland Security Unit and 44 county sheriffs and undersheriffs — in addition to the Guadagno story.

Democratic [url=http://newjersey.watchdog.org/2012/02/09/5924/]State Sen. Fred Madden is a "triple-dipper"[/url]
who collects more than $241,000 a year from public coffers — $49,000 as
a legislator, $106,983 as a police academy dean and an $85,272 pension
as a State Police retiree."I don't have a problem with it at all," said Madden.

The Guadagno controversy
While
Madden and others profit from loopholes in pension rules, the
circumstances surrounding Christie's second-in-command raise questions
of fraud and deception. Guadagno was elected sheriff of
Monmouth County in 2007. She previously worked as an assistant U.S.
attorney and as an assistant New Jersey attorney general. From 1998 to
2001, Guadagno served as deputy director of the DCJ — the unit now
assigned to investigate the case in which she's a major figure.In
2008, Guadagno hired Michael Donovan Jr., a retired investigator for
the county prosecutor, as the sheriff’s “chief of law enforcement
division.” She announced the appointment in a memo to her staff.Monmouth County Sheriff's Office

The
focus of a criminal investigation of pension abuse, Chief Michael
Donovan takes an oath of office in the Monmouth County, N.J., Sheriff's
Office on Sept. 22, 2008. Donovan's job title was fudged to allow him to
collect his pension and his pay at the same time. The swearing in was
witnessed by his mother, Emily, and then-Sheriff Kim Guadagno, now the
state's lieutenant governor. Donovan was sworn in by Judge Lawrence M.
Lawson.



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But there was a problem. As a sheriff's chief officer — a position
covered by the pension system — Donovan would be required to stop
receiving pension checks and resume contributions to the state
retirement fund.Guadagno fudged the job title, so Donovan could double-dip. In county payroll records, the oath of office and a news release, Donovan was called the sheriff's "chief warrant officer" — a low-ranking position exempt from the pension system.

A chief warrant officer oversees the service of warrants and other legal documents. In contrast, the sheriff's official website identified Donovan as "sheriff's officer chief," supervising 115 subordinate officers and 30 civilian employees.

On Guadagno’s organizational chart, Donovan was listed as chief of law enforcement — and the position of chief warrant officer was conspicuously absent.

The
ruse allowed Donovan to collect an $87,500 salary from Monmouth County
in addition to an $85,000 pension as a retired county employee.A Conflicted Investigation
When Guadagno was elected as Christie's running mate in the 2009 election, she resigned as sheriff.

In
2010, state Treasury pension officials began to ask Monmouth County
about retiree Donovan's employment. "I would respectfully request that
former Sheriff Guadagno be contacted..." replied her successor, Shaun Golden, in a letter forwarded to the Treasury.The Treasury denied the existence of any correspondence or email contact with Guadagno or Christie regarding Donovan. Officials also rejected requests for records of the Treasury's inquiry.

In
response, New Jersey Watchdog filed a formal complaint with the state
Government Records Council, a body consisting of gubernatorial
appointees and cabinet officials. One year later, the council has yet to
render an advisory opinion.Meanwhile, the state Police and Firemen's Retirement System's Board of Trustees took action of its own.

"It's
a double-whammy," said PFRS chairman John Sierchio. "If you're going to
retire under one job title and come back under another title, we have a
problem with that. The chief of sheriff is a covered title under the
pension system — and they should be contributing instead of drawing
out."The PFRS board voted in May 2011 to call for a criminal investigation of Donovan and parallel instances involving John Dough, of Essex County, and Harold Gibson, of Union County. The case was referred to DCJ.

However, the investigation is riddled with a maze of potential conflicts of interest:

• DCJ is probing allegations involving its own former deputy director, Guadagno.
• Nearly two dozen DCJ investigators and supervisors are "double-dippers" who collect state paychecks and pensions.
• Attorney General Jeffrey Chiesa, a Christie appointee, is ultimately
  in charge of the probe of fellow cabinet member Guadagno. Chiesa is
  also former chief counsel to Christie.
• Despite evidence of possible wrongdoing by his lieutenant governor,
  Christie has not appointed a special prosecutor or authorized an
  independent investigation.

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One year later, the PFRS board remains in the dark. "I keep asking, but we haven't been told anything," said Sierchio.

New Jersey Governor's Office

Lt.
Gov. Kim Guadagno of New Jersey. When she was a county sheriff, her
office fudged a job description and organizational charts to allow an
aide to double-dip on his pension. Guadagno has declined to comment.Sean
Conner, a spokesman for Christie and Guadagno, refused to listen to
questions about Guadagno's role or the need for a special prosecutor."Let me stop you right there," Conner told New Jersey Watchdog. "If it was referred to DCJ, you need to call DCJ."

The Attorney General's Office did not respond to questions about the investigation.

Back in Monmouth County, Donovan has another new job title — but he’s still a double-dipper. In February 2011, Golden named him undersheriff in charge of law enforcement
— a strikingly similar position, but one apparently exempt in the
labyrinth of pension rules. Donovan currently gets an $86,000 annual
pension on top of his $92,000 salary.While sheriff's chief,
Donovan pocketed $227,000 in retirement checks. Since he did not
re-enroll in the pension system, he avoided $18,000 in contributions to
the retirement fund. If state authorities ultimately determine Donovan
violated pension rules, he could be forced to repay $245,000.Reform...except for double-dipping
Pension fraud and widespread abuse are nothing new in New Jersey.

The federal Securities and Exchange Commission accused New Jersey of pension fraud in 2010. It was the first time the SEC had taken action against a state government over public pension funds.

According
to the SEC, New Jersey misled its bond investors from 2001 to 2007 by
failing to disclose it had not met its obligation to fund public
workers' pension funds. The lawsuit was settled with a cease-and-desist order,
which the state accepted without admitting or denying the charges. The
alleged fraud occurred on the watch of four previous governors.Christie
vowed to overhaul the pension system. With the state facing a $45
billion pension shortfall when he took office, the new governor
spearheaded legislation that he signed into law last year."We are putting the people first and daring to touch the third rail of politics to bring reform to unsustainable system," stated Christie in a news release.
“We are once again showing the people of New Jersey that our state is
leading the way on the biggest challenges before us and remains unafraid
to do what is hard, but necessary."But the reforms did little to
halt widespread double-dipping by numerous public employees, including
Christie's deputy chief of staff.Louis Goetting gets $219,000 a year from the state
— $130,000 in salary as a top aide to the governor plus $89,000 in
state pension payments from an early retirement deal. Christie hired
Goetting in 2010 as a budget guru to help trim the cost of government.In addition, Goetting (pronounced “getting”) received
two golden parachutes from public coffers before joining Christie —
severance packages of $190,000 from Brookdale Community College in 2009
and $180,000 from University of Medicine and Dentistry of New Jersey in
2002.New Jersey Governor's Office

Gov.
Chris Christie of New Jersey has touted his pension reforms, which have
done little to halt the practice of double-dipping by public employees,
including his deputy chief of staff.



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The bottom line: Goetting has gotten more than $1.1 million in
pension and severance pay — and he still draws a six-figure salary from
the state.In answer to questions about Goetting's double-dips,
the governor's press office has reiterated a statement Christie issued
last year: "There is no one in my administration, myself included, who
understands about the operation of this government better than Lou
Goetting does. And so the people of New Jersey have gotten an incredible
bargain.”Pension reforms will not be complete without an
investigative staff to monitor potential abuses, according to PFRS
chairman Sierchio. He noted there are 275,000 retirees — but no
investigators assigned to review complaints."We don't have
anybody watching the store," said Sierchio. "We've got an $80 billion
pension system, and nobody to investigate anything. Once you get your
pension, you never have to look over your shoulder."