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Former Daley Staffer Pleads Guilty to Embezzlement, Fraud

Gene Lee expected to admit he took at least $5,000 from a charity, spent it on himself, then failed to pay taxes on it

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    Chicago's Mayor Richard Daley attends a press conference after the Chicago 2016 presentation on October 2, 2009 at the Bella Centre in Copenhagen, Denmark.

    A former deputy chief of staff to ex-Mayor Richard M. Daley pleaded guilty to embezzlement and tax fraud charges.

    Gene Lee, an aide to Daley for years and a leader of Chicago’s Chinatown community, admitted he took at least $5,000 from a charity, spent it on himself, then failed to pay taxes on it.

    Federal prosecutors last summer charged the 65-year-old with stealing the money from the Chinese Consolidated Benevolent Association in 2007 and 2008.

    Court papers say the federally-funded association gave money to the Chicago Dragons Athletic Association, of which Lee was president, and the Chinatown Summer Fair, of which Lee was chairman.

    Lee "embezzled, stole, obtained by fraud and without authority knowingly converted to his use and intentionally misapplied: the funds, which were supposed to be used for a basketball tournament and to promote traditional Chinese dancing and music, the papers alleged.

    But Masciopinto said Lee believed he was spending the funds on legitimate costs of the charity when he used them to pay for gas, a business suit and other personal expenses; and that he would not have been charged with any crime if he had "crossed his ‘t’s and dotted his ‘i’s."

    "His mistake was that he didn’t seek legal and financial counsel," Masciopinto said. "Over time it added up -- it’s unfortunate."

    Federal sentencing guidelines suggest a prison term of 18 to 24 months is appropriate. But under his plea deal, he is free to argue that probation would be more appropriate, Masciopinto said.

    Lee is likely to cite his extensive involvement in Chicago’s Chinese-American community and his work for the former mayor in mitigation.

    A former organizer of Chicago’s Chinese New Year’s parade, he was appointed chairman of the Chinatown Summer Fair in 1992 by then Ald. Fred Roti, according to the fair’s website. The late Roti was a notoriously corrupt, mob-connected alderman.

    Copyright Chicago Sun-Times