Florida State University Credit Union

A former Florida credit union lending director, who embezzled more than $800,000, used half of the money to pay for online video games, federal prosecutors chaarged.

Kevin Robert Lee was sentenced to 5.5 years in federal prison and ordered to pay $979,839 in restitution to the Florida State University Credit Union, its insurance company and the IRS. U.S. District Judge Mark Walker in Tallahassee also assessed $11,589 in prosecution costs.

Lee, 35, of Tallahassee pleaded guilty to 25 counts of bank fraud, theft, aggravated identity theft and filing false federal tax returns in April.

Although he stole more than $800,000, court documents show he attempted to embezzle a total of $1.2 million. From 2016 to 2018, Lee filed tax returns that failed to claim the embezzled funds as income.

Starting in June 2014, Lee used the name, date of birth and Social Security number of the then-president of the Tallahassee Chapter of Credit Unions to open a new account. Lee was the group's treasurer.

Prosecutors said he used the original TCCU account for fraudulent activity while using the new account he opened for the chapter's legitimate transactions.

Lee also created two accounts using the names, dates of birth and Social Security numbers of his former college roommates. Those accounts served as "intermediary accounts," into which stolen funds were deposited.

Additionally, he transferred funds from inactive member accounts either to pay down the lines of credit he created, to the intermediary accounts he created or into the original TCCU account.

He used the stolen funds to pay off his personal credit cards, to make mortgage and car payments, and for his children's school tuition.

However, most of the money, about $500,000, was used to pay an American Express credit card that Lee used in part to pay for video game in-app purchases, with one month of purchases totaling more than $150,000, according to federal prosecutors.

When members complained about the unauthorized withdrawals or reported their low account balances, Lee told credit union members that their accounts had been closed, and he mailed members a check. To cover up his crime, Lee accessed other members' accounts to replace the stolen money, according to court documents.

At the end of November 2017, in a move very rarely taken by credit unions, the Tallahassee-based FSUCU announced its long-time employee Lee had been fired for embezzlement. After learning of member account discrepancies, FSUCU launched an investigation, restored the affected accounts, reached out to victimized members and notified police.

Peter Strozniak reports for Credit Union Times.