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Colden couple admit $1.2 million fraud against VA, Postal Service

Richard L. Klaffka posed as a severely disabled veteran and postal worker.

He also pretended to be in a wheelchair, unable to walk, drive or care for himself.

Klaffka and his wife, Cathleen, both residents of Colden, admitted Wednesday it was all a hoax.

They also admitted netting $1.2 million in fraudulent benefits as part of their 10-year scheme.

'The defendant knew he wasn't 100 percent disabled and, in fact, knew he was mobile, able to care for himself without assistance," Assistant U.S. Attorney Paul E. Bonanno told the federal court Wednesday.

As part of his guilty plea to wire fraud, Klaffka agreed to pay $1.2 million in restitution and on Wednesday made an initial payment of $325,000. He also agreed to forfeit property he and his wife own in Port St. Lucie, Fla.

With Klaffka, who walks with a cane, standing just a few feet away, Bonanno read from a laundry list of evidence against him, including surveillance of his comings and goings at the Veterans Affairs Medical Center in Buffalo.

Federal agents claim they saw Klaffka drive to the VA, get out of the car and then lift and open his wheelchair without help. They said his wife would then push him into the offices at the medical center.

Bonnano said the government also had witnesses, including neighbors who were prepared to testify that they saw Klaffka hunting, riding a bicycle, chopping wood and playing horseshoes.

Klaffka's defense lawyer said his client's case stems from a decision to exaggerate his health problems - he has legitimate hip, spine and knee problems - in order to increase his disability and workers compensation benefits.

"He's a Marine Corps veteran, honorably discharged, who worked for the post office for 20 years and was determined in 2002 to have a disability," said defense attorney Rodney O. Personius.

Personius said the couple attempted to exploit Klaffka's legitimate health problems, and the effort snowballed into a scheme to defraud the VA and the U.S. Department of Labor, the federal agency that hands out workers compensation benefits.

Defense lawyer Cheryl Meyers Buth said Cathleen Klaffka, 62, was forced to plead guilty because the law says she had an obligation to turn in her husband. She also wonders why it took so long for their crimes to be discovered.

"This case raises questions about how to fix a VA system where someone who is not disabled is paid over a million dollars in benefits despite undergoing regular physical examinations," she said.

Richard Klaffka faces a recommended sentence of up to 33 months in prison when he is sentenced by U.S. District Judge Richard J. Arcara. His wife faces a recommended sentence of up to 12 months in prison.

The Klaffkas' guilty pleas are the result of an investigation by the Criminal Investigations Division of the VA's Office of Inspector General, the VA Police Department, the United States Department of Labor's Office of Inspector General and the United States Postal Service's Office of Inspector General.



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