Alvin G. Weger, Assistant District Attorney CONTACT PERSON:
Scott Tsui, Deputy District Attorney
Major Fraud Unit
(408) 792-2804 For Release on January 15, 2003 FORMER EMPLOYEES OF CHINESE MUTUAL ASSISTANCE ASSOCIATION CHARGED WITH EMBEZZLEMENT AND FALSIFYING DEATH CERTIFICATES
On January 15, 2003, Quoc La, 68, of San Jose, and Tommy Thuduong Young, 72, of Santa Clara, both former employees of the Chinese Mutual Assistance Association (CMAA), were arrested for embezzling $206,000 from CMAA. La is charged with five counts of grand theft and an excessive taking allegation of over $150,000. Young is charged with grand theft. CMAA is a non-profit organization located in San Jose. It has a membership of approximately 5,000 to 6,000, most of whom are elderly Asians. The organization has been in existence since 1981. Similar to an insurance plan, members of the association paid monthly dues to CMAA in return for the promise of a benefit payment to their beneficiaries upon their death. The benefit payment, which ranged from one to fourteen thousand dollars, varied depending on the age the of the individual and the amount of time they had been paying into the plan. Often, beneficiaries, who were mostly family members, would use the death benefits to pay for funeral expenses. In 1985, Quoc La began working for CMAA as a secretary and later as an office manager. He was in charge of distributing the funds in the form of checks to the beneficiaries. His duties included preparing and presenting the benefit checks to two members of the CMAA Board of Directors for signature before they were distributed. Beginning in 1995, La began to periodically issue two benefit checks when persons passed away. One was a legitimate benefit check to the proper beneficiary, and the other would be a fraudulent benefit check made out to one of La’s family members. As time went by, La became more sophisticated and began to alter documents in the deceased member files, and even created phony death certificates of members who were still alive. La issued benefit checks for the fabricated deaths to his family members. To conceal the fraudulent nature of the checks, La prepared them to reflect only partial or incomplete names of his family members. After the checks were signed, La would then modify the payee information. Young, who claimed to be a volunteer of the association was in charge of writing out the checks as directed by La. He assisted in concealing the fraud and altering the payees’ names on the checks. In order to cash the fraudulent checks, La provided them to his family members and asked them to endorse them. Thereafter, the checks would be deposited into the family members’ personal bank accounts. His family members would in turn write personal checks payable to “cash” and give them to La. La described to his family members how he converted the checks to cash and distribute the cash to the families of the deceased association members. La told his family members that he did this because many of the beneficiaries did not have bank accounts and had difficulty cashing the benefit checks. In actuality, La used the checks and cash for his personal benefit. The District Attorney’s investigation included efforts to understand CMAA’s cultural practices, and examinations of over 1,000 deceased member files. Additionally, in order to trace the embezzled funds, numerous search warrants were executed to obtain bank records from as many as 13 bank accounts. The investigation revealed a total of 31 checks, which were fraudulently issued to La’s family members, none of whom were members or beneficiaries of CMAA. The total amount of money funneled out of CMAA currently stands at $206,000. At this time, La and Young are scheduled to be arraigned on January 17, 2003, at 1:30 p.m., in Department 23 of the Santa Clara County Superior Court. If convicted, La faces up to seven years eight months in prison, and Young faces up to three years in prison.