Kam Wong, who led New York's largest credit union (by members)through the 9/11 crisis, the Great Recession and Hurricane Sandy,was charged with fraud, embezzlement and aggravated identify theftin Manhattan federal court after he was arrested Tuesday.

Federal prosecutors said Wong, 62, of Long Island's ValleyStream, allegedly stole millions of dollars from the state's oldestcredit union through various fraudulent schemes from 2013 to 2018,and spent $3.5 million of the money he embezzled on New Yorklottery tickets, according to a federal investigation. The formerCEO was placed on administrative leave by the board of directors inFebruary after receiving a recommendation from a special committeethat was overseeing an internal investigation prompted by thecriminal investigation.

The schemes included getting reimbursed for fake dental work;personal tax liabilities; millions in cash payments in lieu oflong-term disability insurance payments and millions more for taxesto cover those payments; fake car repair bills on one of his luxurycars leased to him by the credit union; educational, housing andliving expenses for two relatives; annual cash advances; ATMwithdrawals and cash payments in place of 320 sick days he neverused that violated his contract.

Wong generally deposited the funds from his schemes into anMCU account, from which, between July 2013 andJanuary 2018, he then withdrew approximately $1.9 million via ATMsover the course of more than 2,500 transactions – an average ofmore than one and a half transactions per day.

On top of buying $3.5 million in lottery tickets from July 2013to January 2018, he also borrowed money from two individuals to buyeven more lottery tickets, according to a criminal complaint filedin federal court.

In addition to his salary, his contract required the creditunion to lease multiple high-end luxury cars for him, including alate-model Mercedes Benz, a Maserati Gran Turismo and mostrecently, a 2018 Ferrari California T.

Although federal investigators reported Wong's annual salary was$684,137 as of January, MCU's latest publicly-available 990 formfor 2016 filed with the IRS showed Wong received total compensationof $5.9 million, which included $2.1 million in base compensation,$1.4 million in bonuses and incentives, $2.2 million in otherreportable compensation, $75,919 in deferred compensation and$40,186 in nontaxable benefits.

Wong joined MCU in 1981 and became its CFO in 1989. He wasinstrumental in helping the credit union restore its operations following the9/11 attacks. MCU's headquarters building stood just a fewyards from Ground Zero. He was named CEO in 2007 and led the creditunion through the Great Recession and then Hurricane Sandy. Despitethese substantial challenges, Wong managed to grow the credit unionfrom $1.3 billion in assets and 294,542 members in 2007 to itscurrent assets of $2.8 billion and 431,817 members.

At the end of 2017, MCU posted a net income gain of $17.5million up from a $3 million net income gain in 2013, according toNCUA financial performance reports. Over the last five years, thecredit union has shown growth in both loans and market share.

MCU continues to be financially sound with a 7.74% net worth atthe end of the first quarter though its ROAA stood at 0.67%,according to NCUA financial performance reports.

Norman Kohn, who served as MCU's chief compliance officer, wasnamed acting president/CEO.

“The charges brought this morning by United States Attorney'sOffice for the Southern District of New York against MCUPresident/CEO Kam Wong are deeply upsetting,” Kohn said in aprepared statement. “MCU was aware of the investigation and hasbeen cooperating with the U.S. Attorney's office. Mr. Wong has beenon administrative leave since Feb. 22, 2018. The credit union hasalerted all relevant regulatory agencies and has been conductingits own internal investigation led by outside counsel. The creditunion is not under investigation. We want to assure our membersthat MCU remains financially strong and committed to theirneeds.”

Wong became aware of the criminal investigation when he wasquestioned by federal agents on Jan. 18. They questioned him aboutpayments he had received in connection to his long-term disabilityscheme. According to federal investigators, he made false andmisleading statements about the payments.

“As Acting President and Chief Executive Officer, I want toassure you that the board and the management team continues to becommitted to the important work we do for you day in and day out,”Kohn added. “MCU is as strong as it has ever been and we willcontinue to provide you, our valued members, with the committed andoutstanding service you expect, and deserve, from us.”