Jessica M. Karmasek Jul. 26, 2013, 6:00pm

RICHMOND, Va. (Legal Newsline) -- Virginia Attorney General Ken Cuccinelli this week requested that the U.S. Treasury Department release $30 million of the $115 million due to the state for the attorney general's office's role as the lead investigator into a Medicaid fraud settlement.

Cuccinelli said Friday that the $30 million would be used to shore up two underfunded retirement funds for state law enforcement officers.

The Attorney General's Office sent the proposal to Eric Hampl, director of the Treasury Executive Office for Asset Forfeiture.

TEOAF holds the remaining $105 million of Virginia's $115 million of asset forfeiture proceeds earned from a fraud investigation against Abbott Laboratories Inc. Abbott paid the forfeiture as part of a 2012 settlement.

This week, Cuccinelli requested that the Treasury approve transfers to the State Police Officers' Retirement System, which is for retired state police officers, and the Virginia Law Officers' Retirement System. VaLORS is for capitol police officers, campus police officers, conservation officers, ABC special agents, marine resource officers, state correctional officers and state juvenile correctional officers.

The attorney general said once his office has reviewed and assessed other funding proposals from other Virginia law enforcement agencies, a specific dollar amount will be designated for each fund; likely at least $15 million for each.

"It is critical that these retirement funds be preserved so that they can continue to provide the retirement benefits that were promised to public safety officers who have faithfully served their fellow Virginians," Cuccinelli said in a statement.

"If Virginia's retirement systems for state law enforcement officers are not on secure financial footing, it could lead to problems in recruitment, morale and retention that would ultimately have a profoundly negative impact on public safety. These contributions are one way to help."

The attorney general noted, "A similar funding request was made and approved by the Treasury in a previous case in Rhode Island, so we feel this request should be approved."

Cuccinelli said he will be submitting more proposals asking the Treasury to release additional funds for other law enforcement needs in the coming weeks and months.

The $1.5 billion settlement reached with Abbott Laboratories in May 2012 was divided into $800 million in civil settlements with the federal government and the states, and $700 million in criminal fines and forfeitures.

Abbott allegedly promoted the prescription drug Depakote to control agitation and aggression in elderly dementia patients and to treat schizophrenia, even though the federal Food and Drug Administration never approved the drug for those uses.

The drug was approved by the FDA to treat epileptic seizures, bipolar mania and migraines.

Under the criminal portion, Abbott paid the federal government a criminal fine of $500 million, it paid $1.5 million to the Virginia Medicaid Fraud Control Unit for investigative costs, and it forfeited assets of $198.5 million to go to the investigative agencies for law enforcement purposes.

Virginia's $115 million comes from that asset forfeiture money, which is required by federal regulations to be used for law enforcement purposes.

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