San Diego has quickly become the poster child of union pension fund mismanagement. The city, which famously mismanaged its pension fund, was force to nearly declare bankruptcy. Thankfully things are looking better now.  In fact, this morning the city’s independent pension board will vote to inject a little more security into the system.

But then there’s the story of Judie Italiano. She led the city’s largest union, the Municipal Employees Association, for 24 years, until an internal investigation last May determined that she was using the union’s credit card for personal items “despite promising not to do so in 2006.”

Italiano is now suing the city for $1.8 million. Italiano, who retired from the union making $114,000, wants the city to pay her $86,000 a year in retirement benefits. The trouble is that she wasn’t a city employee, and under IRS regulations, she’s not eligible to receive benefits from the plan. In fact, her last city job was as a typist making $17,000 a year, which would entitle her to $7,700 per year.