NYC Police Union President, Treasurer Charged in $500K+ Benefit Scam

Police unions have been receiving much criticism these past couple months, and two trustees of a New York City police union benefit plan haven’t helped matters. Three days ago, July 13, Kenneth Wynder Jr., president of the Law Enforcement Employees Benevolent Association (LEEBA), was charged in U.S. District Court for the Southern District of New York with defrauding the LEEBA annuity fund of more than $500,000 following his arrest. Separately, LEEBA Treasurer Steven Whittick was charged with obstruction and making false statements in the case. Acting U.S. Attorney Audrey Strauss explained, “Today we have charged two leaders of a union that represents local law enforcement officers for engaging in criminal conduct.” The charges follow a joint probe by the FBI, the IRS, the U.S. Labor Department and the City Comptroller’s Office.  

At the beginning of this month, Union Corruption Update analyzed the lengths to which police unions often go to protect their members from public accountability. The immediate backdrop here was the virulent street protests in the wake of the May 25 death of a black criminal suspect in the custody of Minneapolis police. Many of these protests degenerated into mindless and destructive riots. The article explained how such deaths might have been prevented if police unions didn’t insulate themselves so often from outside scrutiny, especially through their insertion of certain types of clauses into their contracts. It noted as well that the high incidence of fraud and embezzlement in these unions are likely by-products of collective bargaining. The article cited recent cases in Rhode Island, Detroit, Miami and Jacksonville.   

That brings us to allegations of fraud within an annuity fund sponsored by the Law Enforcement Employees Benevolent Association. LEEBA negotiates with the City of New York on behalf of law enforcement officers employed by local agencies other than the NYPD. They include the Department of Environmental Protection, the Department of Sanitation and the Department of Transportation. Officers of such agencies now have fewer assets in their retirement plan, thanks to Kenneth Wynder and Steven Whittick. Wynder, now 56, a resident of Stroudsburg, Pa. and a former New York State Trooper, is president of LEEBA, a member of its board of directors, and a former trustee of its annuity and welfare funds. Whittick, now 50, a resident of Kingston, N.Y. and a Department of Environmental Protection police officer, is treasurer of LEEBA, a member of its board of directors, and a trustee of its annuity and welfare funds. The pair regularly interacted. That was kind of the problem.

Wynder faces one count of wire fraud. He allegedly masterminded what prosecutors are characterizing as a “scheme to withdraw funds from the Annuity Fund and from the retirement accounts of individual members held by the Annuity Fund under false and fraudulent pretenses.” Key to this scheme was his making false statements to the annuity fund custodian to justify the withdrawals, and making misleading statements to current and prospective members to induce them to invest. The U.S. Attorney complaint states that from around 2012 to 2019 Wynder caused the custodian to withdraw and transfer about $529,000 from the annuity fund to the LEEBA general operating fund. He facilitated these transfers by assuring accountants that he would comply with their instructions to refrain from withdrawing money unrelated to administration and to repay any outstanding funds owed.  

In fact, say prosecutors, Kenneth Wynder did neither of these things. Moreover, after retirement assets had been transferred, he exercised carte blanche to steal. “Between 2014 and 2019,” reads the complaint, “more than $450,000 in cash or cash equivalents was withdrawn from various LEEBA bank accounts, principally by Wynder or LEEBA’s treasurer (i.e., Whittick). Many of the withdrawal slips bore the signature of Wynder or LEEBA’s treasurer, while some of the withdrawals were used to purchase cashier’s checks payable to either Wynder or LEEBA’s treasurer.” Among Wynder’s indulgences were the bulk of the payments on a $77,000 Lexus, rent on an apartment in Astoria, Queens, and a weekend trip to Dallas for himself and about five other LEEBA employees and/or board members for the purpose of attending NCAA and NFL football games.

Wynder allegedly concealed the thefts of LEEBA funds through acts of commission or omission. As the U.S. Attorney’s Office puts it: “…(T)hroughout the duration of this scheme, Wynder repeatedly made and approved false and misleading statements to LEEBA’s members and prospective members about how he was purportedly using and protecting their retirement accounts and the LEEBA Annuity Fund. Wynder further concealed his scheme by causing LEEBA to fail to timely file mandatory reports and financial disclosures with the City and public reports to the Annuity Fund’s members, and by making false statements to the Annuity Fund’s auditors and accountants.”

He had help in the coverup from LEEBA’s treasurer, Steven Whittick. From sometime in 2017 until around August 2019, charging documents allege, Whittick repeatedly lied to federal agents in an effort to obstruct their investigation. After FBI agents had executed a search warrant of LEEBA’s offices in September 2019, Whittick made false statements to law enforcement agents during two separate interviews concerning his financial gain. Apparently, something was in it for him. Prosecutors allege that on two occasions – on or about February 1, 2018 and March 30, 2018 – he withdrew $16,000 in cash from a LEEBA bank account. In each case, he deposited $15,000 in cash into Wynder’s personal bank account and $1,000 in cash into his own account.   

All this begs the question of why it took the union more than a half-dozen years to become aware of the thefts. One very likely explanation is that LEEBA has managed to hold the upper hand in collective bargaining with the City of New York. As such, the union has protected its benefit fund managers from the consequences of neglecting their fiduciary duties. As this episode unfolds, it should serve as another example of why police unions, like the officers they represent, must be made more accountable. Cops exist to enforce the law, not to break it.   

Postscript: On September 8, Wynder and Whittick each were charged in a 13-count superseding indictment for wire fraud, conspiracy to commit wire fraud, tax evasion, making false statements to federal agents, and obstruction of a grand jury investigation.