NEW YORK–The former CEO of Municipal Credit Union has been sentenced to more than five years in prison for embezzling more than $10 million from the credit union.
Kam Wong, who had once been widely admired both inside and outside credit unions for his success story, received a sentence of 66 months for stealing the funds, which prosecutors said went toward everything from luxury cars to lottery tickets.
Wong moved to New York from Hong Kong with his family in 1975 when he was 19 and he worked at a Brooklyn restaurant while taking accounting classes at Baruch College. Upon graduating, Wong joined MCU and became CEO in 2007.
The $3-billion MCU was placed into conservatorship by New York’s state regulator and is now being operated by NCUA.
Wong, 63, fought back tears as his lawyers sought to persuade U.S. District Judge John Koeltl to sentence him to less than the up to 121 months sought by prosecutors, according to Crain’s New York. The attorneys argued Wong was a victim of a gambling addiction.
‘Betrayed My Family’
"I betrayed my family, my company and deceived everyone who trusted me and I can’t explain why," Crain’s quoted Wong as telling the judge. "I’m grateful the government stopped me before I could cause more damage."
Wong’s wife, Ruby, and two sons were present at the sentencing, as were many Municipal CU employees, according to the report.
One Employee Not Happy
Crain’s New York reported Selenia Garcia, a senior mortgage collector who has worked at MCU for 24 years, said some of CU’s 700 employees have seen their pay slashed by 35% since NCUA took over.
“Am I satisfied with today’s sentence? No, absolutely not,” Garcia told Crain’s. “A lot of people at MCU are suffering.”
As CUToday.info reported here, Wong had entered a guilty plea in November of 2018.
As CUToday.info also reported here, Wong's attorneys had earlier described him as "a walking testament to human frailty and the dangers of unchecked addiction" in their own memo to Judge Koeltl.
But federal prosecutors said Wong’s actions make clear he is a different man that the one described in those letters.
"It is difficult to overstate the damage that the defendant caused—damage so severe that the credit union was recently placed into receivership," the prosecutors wrote in a May 20 sentencing memo, Crain’s reported.
As CUToday.info reported earlier, among the various charges made by prosecutors as cited by Crain’s New York Business, Wong:
- Allegedly billed the credit union $280,000 for dental work that was never performed
- Submitted sham invoices for $25,000 worth of car repairs that were covered by insurance
- Withdrew $8,000 from credit union ATMs, which Wong said was for the purpose of "testing" them
- Billed MCU more than $100,000 to cover the rent, education and living expenses of two interns who did little or no work
- Stole $7.7 million from the credit union for the purpose of buying disability insurance that was never purchased
Federal investigators said when they began looking into events, Wong lied to them and told others to lie, according to the report.
Among the headline-grabbing allegations in the alleged theft has been that Wong used millions of dollars to buy lottery tickets, including buying $100 worth of Win4 tickets every day. According to his attorneys, the “stress” from the financial crisis and Superstorm Sandy led Wong between 2013 and 2017 to steal $4.5 million from MCU to buy lottery tickets. Allegedly, a member of MCU's supervisory committee helped keep the credit union in the dark, “while Wong soothed his conscience by popping hydrocodone pills and sipping from a bottle of codeine-laced syrup at his desk,” Crain’s New York reported.
“Prosecutors added that Wong doesn't even appear to have worked all that hard running MCU,” the Crain’s review of the sentencing statement reads. “They said a review of his Internet history shows he spent ‘hours each day’ online engaging in social media, watching Hulu and YouTube, researching Hong Kong real estate and building his car—a custom Bentley.”