A former IT vice president agreed to plead guilty Sept. 15 to embezzling more than $2.6 million from the $10.4 billion SchoolsFirst Federal Credit Union in Santa Ana, Calif., according to court documents.

In a plea deal with federal prosecutors in Santa Ana, David Lugo admitted to ordering IT equipment that was neither needed nor authorized by SchoolsFirst and wired funds from a credit union account to pay for the equipment. After arriving in the mail at his office in Tustin, Lugo sold the equipment to resellers in Orange County, court documents showed.

Federal prosecutors said Lugo deposited the embezzled funds in his personal Wells Fargo bank account and spent the money on a family trip to Hawaii, a European vacation with his wife, family trips to Disney World as well as multiple trips to Las Vegas and other local casinos and resorts.

He also used the stolen money to pay for his daughter's education at the University of Southern California, vehicles for his wife and himself, jewelry for his wife and daughter and medical bills for a family member, according to court documents.

Lugo was hired by SchoolsFirst in 2000 as a systems administrator and eventually worked his way up to vice president of IT. Court documents showed Lugo's fraudulent scheme began in 2003 and continued through July of this year.

Federal prosecutors said Lugo managed to hide his theft for so long because the inventory in the IT department was not well monitored and other employees were not in a position to understand the company's IT equipment needs. What's more, Lugo erased computer entries relating to the multiple purchases of the IT equipment, according to court documents.

Lugo agreed to plead guilty to two counts of wire fraud and two counts of mail fraud for which he could be sentenced up to 80 years in federal prison.

A sentencing hearing date has not been scheduled yet.

A comment from SchoolsFirst was not immediately available.

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Former SchoolsFirst VP Pleads Guilty to Embezzling $2.6M

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