DAVE GRAM

Associated Press

MONTPELIER -- Top Vermont elected officials called Wednesday for legislation that would allow the state's public retirement funds to recoup money from employees convicted of fraud or embezzlement against a public agency.

The move follows charges filed in July against former state police Sgt. James Deeghan, who pleaded not guilty to two counts of making false claims by allegedly padding his overtime reports. Authorities said Deeghan justified the extra time in part by writing and filing 973 traffic tickets without actually giving them to motorists.

"Public employees who steal from the public treasury should not be allowed to benefit in retirement from their ill-gotten gains," said Attorney General William Sorrell. "Pension forfeiture legislation will provide a process that will allow a court to ensure this does not happen."

Sorrell joined Gov. Peter Shumlin, lawmakers and other officials in announcing they were drafting a bill to allow a judge to require partial or full forfeiture of a retirement pension for state, municipal or public school employees who defraud their employers. Lawmakers vowed to take up the matter early in their 2013 session, which begins next week.

The officials acknowledged that the new law would not work retroactively and would not affect Deeghan if he is convicted, but said it could provide protection for the public in similar cases in the future.

Public Safety Commissioner Keith Flynn said audits of time reports by troopers at the Williston barracks, where Deeghan worked, and for the 327-trooper state police force at large found no evidence of wrongdoing by anyone else.

Shumlin said that because a judge would make the final determination of restitution, the proposal "strikes a good balance of protecting taxpayer money while not being unduly punitive against employees and their innocent dependents."

The bill calls on the judge to weigh family circumstances, the severity of the crime, how much money was lost and how much public trust had been placed in the individual as factors in determining what amount of an employee's pension can be seized.