A federal judge in Cleveland, Ohio recently ordered a convicted public official to pay $57,000 in damages by taking those funds from his retirement account. An Ohio law passed several years ago specifically authorizes such an action if a public official has been convicted of certain crimes, including bribery. The decision by U.S. District Judge Sara Lioi was reported in an October 29, 2011 article by James McCarty in the Cleveland Plain Dealer.
The convicted public official (former state court judge Steven Terry) was ordered to cash out the $57,000 from his retirement fund. Mike Tobin, a spokesman for the U.S. Attorney’s office, acknowledged that this was clearly a precedent.
Retirement accounts are generally well protected from creditors. The Ohio statute involved in this particular matter has limited application — to certain convicted public officials. It is nevertheless important to be aware of cases like this one — because we would not want to see a law like this one extended too far.