It was back in 2012 when the now-woke Preet Bharara made his huge splash by revealing his prosecution of a massive fraud being perpetrated by former employees of the Long Island Rail Road. Massive. MASSIVE!!! How much we adored Preet for protecting the public fisc from these lying, scheming miscreants. No one adored Preet, and accepted his every word about this massive (did I mention massive?) scheme, as much as the media. Rumor is that there was a shrine to Preet at Newsday.

In contrast, an old lawyer called bullshit. He did so over and over, not just because it was “mostly” a sham, but because almost everything being told the public about it was false. And in the process, this “massive” group of individuals and their families affected by this sham found themselves in an impossible position.

Reviled by the public for being fraudsters. No one in the media willing to listen, to learn, that they were spewing prosecutorial nonsense. Their disability payments cut off, threatened with prison, the loss of their homes and savings, humiliation, these were people who not only suffered from a disability in real life, but now suffered from the threat of their lives being destroyed in futuro. And the public was thrilled by it.

Six years later, the “masterminds” of this scheme are no longer of great public interest. Preet is gone, elevated to icon status by the newly-sensitive who are neither aware, nor concerned about, of how many black lives didn’t matter to him, because was he fired by Trump, and they hate Trump more than they are willing to give of their time to have a clue who they’re gushing over. But the case, that massive case, still lives in the system, not that anyone gives a damn anymore.

The core group of four defendants pleaded guilty years ago, when it seemed clear that they would be crushed by the “massive” fraud case the government built around them, no matter how much of it was false. The potential to challenge the lies built upon lies was daunting; too much so to take the chance. And then, for this core group, there was the problem that there was guilt. There were people whose applications were fudged, faked, exaggerated and falsified. They weren’t clean, but they weren’t nearly as dirty as the government alleged.

As part of a decades‐long scheme to defraud the [Railroad Retirement Board], defendants Rutigliano, Ajemian, Lesniewski, and Baran, together with 17 confederates, repeatedly submitted applications for disability pensions based on fabricated medical documents.    Orthopedic physicians Ajemian and Lesniewski created these fabricated documents.   Rutigliano, a former LIRR conductor and union local president, obtained a disability pension for himself by submitting false documentation of his physical condition from Lesniewski.   Rutigliano also acted as a facilitator or consultant for numerous other LIRR employees seeking disability pensions, charging approximately $1,000 per person to fill out fraudulent applications.  Baran, a former RRB employee whose LIRR‐employed husband obtained an RRB disability pension through a fraudulent application supported by Lesniewski, also acted as a facilitator‐for‐hire, submitting disability pension applications for LIRR employees that she knew were supported by fraudulent documentation.

In addition to their sentences of imprisonment, this core group was sentenced to restitution for the “massive” losses the government claimed. The main defendant, Peter Ajemian, the physician from whom most of the LIRR retirees got their disability diagnosis, was sentenced in 2013 to pay restitution in the amount of $116,500,000, presumably reflecting the total of disability payments made to Dr. Ajemian’s “patients.” Mind you, Ajemian didn’t get the money, but that’s not relevant to the way the government calculates loss. And at the time, nobody cried a tear for the unfairness of it all.

But time goes on, and facts come out, and reality then gets in the way of a good government story.

By May 22, 2015, the RRB had decided 531 reapplications for disability pension benefits, granting 485 and reinstating such benefits retroactive to the terminations effected by Board Orders 13‐33 and 13‐55.  Approximately 80% of the granted reapplications relied on at least one new medical condition not included in the employee’s initial fraudulent application, and approximately 70% of the granted applications omitted at least one medical condition relied on in the initial fraudulent applications.

After unilaterally terminating benefits for every retiree whose disability was based on Ajemian’s diagnosis, the RRB finally relented and allowed retirees to reapply. Some were ineligible, having taken the government’s “amnesty” program by paying back benefits. Some, presumably, did so because they were scammers, but some because they were scared to death they would be prosecuted. The FBI kept sending the retirees letters threatening their imminent doom if they didn’t confess and disgorge. The disabled retirees weren’t keen on dying in prison.

Others couldn’t manage to reapply, having long since tossed the paper work from the LIRR days, their injuries, and thus were unable to prove their current condition was the product of their jobs. Still others just couldn’t muster the will to do the paperwork, as it was onerous, confusing and, well, they weren’t paperwork people. Some weren’t particularly literate, which wasn’t a big requirement for the job of track worker. And some were still too scared to take the chance.

But the upshot is that 80% of the LIRR retirees on disability turned out to be legitimately disabled. Of the remaining 20%, it’s impossible to say with certainty how many were scammers, but certainly not all of them. So much for “massive.”

The core defendants tried an end run around their restitution sentence, the “lowest” of which was for Marie Baran, who filled out applications for the disabled, at a mere $31,398,907. The Second Circuit, by Judge Reena Raggi, handily rejected the argument that they could challenge the restitution amounts by way of a §2255 motion, the statutory substitute for habeas corpus, based upon the reality that the vast majority of this “massive” scheme wasn’t fraudulent at all.

The court held that restitution couldn’t be collaterally attacked under §2255 as it wasn’t “sufficiently severe restraint on individual liberty” to warrant habeas relief.

In sum, because defendants fail to show that the restitution ordered in their judgments of conviction equates to custodial punishment, the district court was without authority to review and reduce restitution pursuant to § 2255.

Does that mean that there is no remedy for these defendants, given post-hoc reality that the government fabricated a “massive” scheme that never happened? Pretty much. On the bright side, none of the defendants will live long enough to make a dent in their restitution orders. But their suffering is nothing compared to the suffering of the “massive” number of LIRR retirees who were very disabled, denied disability by mass termination of benefits without any individual review and were forced to live without benefits and with grave fear, for having gone to the very doctor the LIRR expressly recommended they see, because he knew how to get things done.