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Lady Bountiful

To anyone who knew her, Cecilia Chang was the gift that just kept on giving, be it designer watches, luxury holidays, scholarships or cold, hard cash. So how, asks Steve Fishman, did the flamboyant university fundraiser's massive fraud evade detection for 30 years?

 

Cecilia Chang had always been a meticulous planner, so it made sense that she left three notes at the scene of her suicide, each prepared for a specific audience. The previous day (Monday, November 5, 2012), she'd tied up a loose end, testifying at her own trial and admitting to defrauding her employer, St John's, a private, Roman Catholic university in Queens, New York, in the United States. She'd stolen hundreds of thousands of dollars, living a super-rich life on a university salary that at its peak was US$120,000. On the Tuesday, as on every other day, she was flawlessly put together, her hair carefully arranged to conceal a thinning spot. She wore one of her flowery, silky blouses with a fitted black jacket.

Then, in her Queens home, where the government said she'd forced scholarship students to clean and cook, she turned on the gas in the kitchen, slit her wrists and, when the desired result didn't come quickly enough, tossed a stereo cord over the ladder to the attic and hanged herself. The notes, carefully written in Chinese, were found at the scene. One was to her only son: "I love you," she wrote, and she apologised to him. Another, addressed to the judge and jury, with a politeness she maintained till the end, thanked them for their time and attention. The third, the most elaborate, she addressed to her employer, for whom she reserved her fury. She'd been a fundraiser at St John's for three decades, bringing in millions of dollars. And in the end, she felt the school had abandoned her. In her note, she described herself as a scapegoat.

Chang was fantastically corrupt, there can be no doubt. The details of her fraud are outlandish, grotesque. She charged her bookie's daughter's wedding to the university, disguising the roughly US$14,000 expense as a business charge; she had St John's pay almost US$58,000 for her son's law-school tuition, plus textbooks and lunches. But Chang was something more than a simple con artist, deceiving her employers for personal gain. She was deeply embedded in the institution - she'd built herself a nest and had feathered it well, while taking elaborate care of those around her. She seems to have been sincere - if deluded - in her belief that she'd earned the life she'd built. Over the years, she was the university's second-most successful fundraiser - only president Father Donald Harrington ranked above her. She may have raised close to the US$20 million she claimed - although in the final few years, when her fraud was at its height, she spent as much as she took in, or even more.

Some of that spending went to feather other nests, too. She was a doting mother - she gave her son a credit card, then billed everything from his ski holidays to his Big Macs to the university. She was a good friend, showing her love through ostentatious gifts - the children of friends got St John's scholarships. But it was her superiors who received some of the most lavish rewards. She spent tens of thousands of dollars on Father Harrington and tens of thousands more on his chief of staff, Rob Wile. Wile had a credit card on Chang's account, and in five years, according to credit-card statements, he charged roughly US$45,000 to it - including at Prada, Lanvin and Ferragamo - even during the period when he was signing off on Chang's expenses. The gifts to Father Harrington included suits from the finest Hong Kong tailors, a watch from Patek Philippe, cases of expensive wine and a Caribbean holiday, some of which Chang coyly suggested were underwritten by unnamed "friends of the university", though, in fact, they were billed to St John's itself, concealed as legitimate business expenses. "She took care of everyone that she met," says one investigator. "Everyone that she needed."

In Chang's mind, according to her testimony, her methods and extravagant, university-funded lifestyle were accepted, if unacknowledged, as the way she did business. Chang operated her own completely independent fiefdom within the university, one with its own set of rules - she rarely even set foot on campus. Officials didn't question that. Nor did they insist on identifying the supposedly generous "friends" underwriting their expensive perks.

Then when her fraud surfaced in late 2009, those same officials appeared shocked.

"For 30 years, they all turned a blind eye, and nobody knew anything," says one of her lawyers, Stephen Mahler. Chang put it more succinctly in her testimony: "They should know."

St John's is today a very different school from the one Chang arrived at almost 40 years ago - and for all her corruption, she played a role in changing it. In August 1975, the 22-year-old arrived with a bachelor's degree from her native Taiwan and a grant that covered her tuition.

Chang let people know about her illustrious bloodline, which she said connected her to Chiang Kai-shek, one of the founders of modern Taiwan, and about her family's wealth (doubted by investigators), which she liked to emphasise with a sable coat that fitted snugly over her size 1 frame. Chang quickly accumulated a master's and an MBA and, a few years later, a doctorate in education from Columbia University. Her English was spotty at best - she never entirely mastered the language - but she was resourceful, if not entirely ethical; she paid a fellow Columbia student to rewrite her dissertation. And she was a natural host with a talent for captivating her superiors, particularly men.

"She was like a courtesan," says one of her frequent male dinner companions. "She hovered over you." She carried a pad and took notes during conversations, as if what her dinner partner said were too important to be forgotten.

Chang quickly became friends with St John's then president, Father Joseph Cahill, a vociferous conservative firebrand. Cahill single-handedly fought off a move to secularise St John's, insisting that all wisdom flowed from the Vatican. Cahill, who had a natural sympathy for Chang's anti-communist homeland, understood that her ties could help the university. In 1977, when she was 23, he tapped her to help direct the Centre of Asian Studies, of which she would become dean, and be a fundraiser who would court the wealthy Taiwanese community. And there was something else that attracted him to the youthful Chinese woman. Chang later claimed that she had been intimate with Cahill, according to The New York Times, and one of his good-time friends. Cahill liked to gamble, and Chang accompanied him on trips to Belmont and Atlantic City, she later testified.

Father Harrington succeeded Cahill in 1989, just after Chang became an American citizen. Like Cahill, Harrington was a Vincentian, a member of a network of Catholic societies devoted to helping the poor. But Harrington was different, a friendly if bland public face with a welcoming smile.

Harrington expanded the Vincentian emphasis on the less fortunate - more than 40 per cent of the university budget goes to financial aid, among the highest for any private university - and even enrolled the homeless. But growth was his goal and, unlike Cahill, he made diver-sity and inclusion his watchwords. "Most of our student body is not Catholic," he later boasted. St John's students come from 122 countries.

Chang was a perfect fit with Harrington's global goals. Soon after he took over as president came news that the Taiwanese government had donated almost US$700,000 to St John's, the first of many gifts. For Harrington, empowering Chang made flawless sense.

Before his departure, Cahill counselled Harrington on how to handle his new charge, telling him that Chang operated by her own rules. "Trust her. Let her do her job, and she'll bring in money," he said.

In one of their first meetings, Harrington got a glimpse of Chang's rules. She worked her usual charms, deploying her ever-present smile, politeness and over-the-top compliments. ("I know of no one as diplomatic or as articulate as you," she once wrote to Harrington.) Then, as she was leaving, Chang presented her new boss with a gift-wrapped package. Harrington opened it later - and found a stack of US$100 bills.

Harrington summoned Chang back to his office and, he later testified, told her the gift was not appropriate. Harrington, who'd taken a vow of poverty, lives in a modest communal house with other priests and receives US$200 a month, ample for his necessities, he said.

Harrington testified that Chang was wounded by the rejection. "I want to work well with you," he recalled her saying. "I don't see why this is wrong." She insisted that in Chinese culture wealthy women have to give gifts to their bosses. She liked to tap her handbag, signalling that she had plenty of wealth to dispense.

Chang wanted Harrington to accept the cash.

"Give it to the poor," he told her.

Later, she handed him an envelope. "This is for the poor," she said.

"I have a drawer in my office, which I keep locked, where, when people give me money for the poor," he testified, "that's where I put it." He didn't make a record, didn't even count the amounts of subsequent gifts - he couldn't recall how many envelopes he'd received over the years, maybe a half-dozen - and never reported them to the university. The reason, he told the court, was that he accepted the money under his auspices as a priest. "This was not connected to St John's," he said.

Not many fundraisers would get far if they depended on pure charity - usually, the donor must feel he or she is receiving something. Chang was more transactional than most.

"They were basically selling honorary degrees," says Mahler. Chang's straightforward approach worked best with Asian businessmen eager to put "Dr" in front of their names, especially from an American university.

Another weapon in Chang's arsenal was Harrington himself. A striking silver-haired figure in his black clerical garb, Harrington didn't dominate a room. But in a face-to-face meeting, he was unmatched. Like a skilled politician, he remembered everyone's name, as well as the names of their children and pets. Every year or two, Chang took him on a 10-day swing through Asia. For Chang, it was a chance to impress her boss with her many important connections, and she planned every detail, pampering the entourage with the best of everything, explaining that donors were underwriting many of the gifts. She booked the St John's contingent, including Harrington and Wile and other priests, and one year her son, into the very best hotels, including the Peninsula and the Regent, reserving the presidential suite for Harrington at times.

Harrington said he protested against such luxury. "[But] she assured me that this was very important for the people who were visiting because it would impact on the image of St John's University as a first-class university if we stayed at those places. I didn't fight that."

In court, Harrington presented himself as both a busy chief executive commanding 3,100 employees and a naïf, unsophisticated in the ways of the world. He professed to be shocked at the culture he found himself in. "I had heard that gift-giving was a very, very strong part of the Chinese tradition and culture, but I saw it in practice. I told Cecilia I had to rely on her to guide me through this because I did not know the culture, and I had to know what was appropriate or not appropriate."

So the gift horse was not looked in the mouth - and the gifts kept coming. Year after year, Chang ordered suits for Harrington from Modestos Limited and Sam's Tailor, two of Hong Kong's best tailors. Again, he was reluctant.

"I asked what that was about, and Cecilia indicated that our friends in Hong Kong are honoured by the visit from the president and the delegation, and the way they show that is by having suits made for them and presenting that as a gift," explained Harrington in court.

Chang also encouraged Harrington to get a Taishin credit card, arguing that it would serve as an overseas back-up to the university-issued American Express card. Harrington resisted, but then said Wile could carry one of the Taishin cards. "The conditions were that … both Cecilia and I would know about it before it was used," Harrington testified.

Wile was personable and easygoing, a complement to the stiffer, more formal Harrington. Donors liked him, as did their children. Harrington enjoyed his open manner, too, and they became friends outside the office - it was a father-son relationship, some said. In 2004, Harrington appointed Wile, not far past 25, his chief of staff; even before that, Wile had put Chang's credit-card account to work.

In May 2003, Wile racked up the year's heftiest charge, US$8,474.82 in the Turks and Caicos Islands, most of it at the Point Grace hotel, a luxury resort where he and Father Harrington spent a few days. That trip was shortly after Harrington's father died, and Chang, ever attentive to his needs, urged Harrington to take a holiday, assuring him that in Chinese culture it was customary to offer a gift to someone who has lost a family member. Harrington testified that he reported gifts to his religious superior in accordance with his vow of poverty but declined to comment on whether he'd reported the Turks and Caicos holiday. Wile wanted to take his girlfriend, and Harrington - just as he did for himself and Wile - booked her flight with points from his St John's credit card. Chang, of course, passed the expense for the holiday on to the university.

Two years later, in 2005, Wile went shopping in Hong Kong. He spent US$1,201.99 at Ermenegildo Zegna, Louis Vuitton, Lanvin, Hermès and others. The next year, he dropped US$1,200 at Prada. In June 2008, he billed US$2,367.29 to Chang's account after visiting Lanvin in Hong Kong. Wile's purchases were for him and his wife. Wile, who testified before a grand jury and got state immunity, told investigators, "It was incredibly stupid, but Cecilia said, 'Go ahead, you deserve it,' and said it was all covered by donors," according to an account of the conversation.

That Chang benefited from her subterfuge is clear - to the tune of more than US$1 million, according to the Queens district attorney, though it was probably double that. But she didn't appear to make money from the couple of hundred thousand dollars in gifts to Harrington, Wile and other university officials - that was more in the way of managing up. Chang seemed sure she was fulfilling their wishes.

"With our delegation," she testified, "[we] go to Hong Kong, we go to the jewellery shop. Whatever they walk around they pick up, so I just pick up the bill."

Among the expensive road-trip party favours, luxury watches were a speciality. "She explained to me that a watch has special significance in terms of a gift in Asia because of its long life," Harrington testified. "I never understood it fully, but I respected it because that's what she said."

Harrington testified that he assumed the watches were gifts from Samson Sun, a Hong Kong watch merchant and honorary-degree recipient - "a wonderful, wonderful man", Harrington said - but didn't ask. They weren't from Sun, though. In an e-mail, Sun wrote, "I was not the donor of any watches to Father Harrington or the St John's people."

Harrington chose a Patek Philippe estimated to be worth US$5,000 and, during a June 2008 trip, an equally pricey Omega platinum Case Gent's. On one trip, Wile received a stainless-steel Rolex Submariner.

Chang knew that on the way home from Asia, Harrington always stopped in Hawaii for a few days to avoid the jet lag that he said would otherwise last 10 days. In June 2008, Harrington and his contingent booked into a Four Seasons in Hawaii. Usually the university picked up the bill, but that year Chang volunteered to pay - she said there was an unnamed donor. Wile put the US$13,000-plus on Chang's account. Harrington said he thought he was saving the university money, but Chang billed it to St John's.

Chang was accustomed to seeing her fudged expenses sail through. For a year or so, Wile was one of the two people to approve them. He signed one form on September 24, 2008 that covered the period during which Wile had put a Hong Kong shopping spree as well as the Four Seasons visit on Chang's account. He apparently didn't notice that none of those charges appeared on the statement.

Harrington knew that Chang often departed from standard operating procedure - ignoring, as her lawyer Joel Cohen charged, "obvious red flags". Auditors recommended Chang drop the Taiwanese credit card - some of the bill was in Chinese characters. Harrington told her that "unless she could satisfy the [chief financial officer], she could no longer continue at St John's", according to notes from his FBI interview. But he let her keep the card after she explained that the Taiwanese bank president was a donor and would be insulted if they dropped it. As for handing in originals of the bills, another of the auditors' recommendations, she ignored it. Soon after, Harrington learned Chang had again brazenly flouted the rules. She'd granted her son a scholarship to the law school, which Harrington said "disappointed" him. Chang immediately admitted her mistake and wrote two cheques totalling US$58,700 to cover back tuition. She then hid them in her expenses, which Wile reviewed.

That no one scrutinised her huge expenses - she accounted for 10 per cent of St John's entire travel and entertainment budget in later years - implied, as she saw it, tacit permission to operate outside the rules. "It's nearly impossible to believe that she was able to behave this way without at least a wink and a nod from some at the school who benefited from her 'generosity'," said Alan Abramson, another of her lawyers.

Perhaps Chang's most obvious idiosyncrasy, one with which her superiors were certainly acquainted, was her promiscuous dispensing of scholarship grants over 20-odd years. She extended grants to the children of just about everyone she knew: one to her hairdresser's nephew, another to her favourite Queens restaurateur's daughter, and one to the daughter of Marianna Addabbo, who later worked as her assistant. "If you knew her, you got a grant," said Mahler.

The students' only obligation was to work 20 hours a week, a duty Chang took full advantage of. Some students worked in her office falsifying expense reports, while others worked at her home cooking, cleaning, driving, taking her fur coats to the cleaners, and ferrying around her son, whom the state called an unindicted co-conspirator. These assignments led the federal government to charge her with forced labour.

Chang didn't tell anyone specifically about how she used the students. But as she testified in her imperfect English, "I think they don't want to know they don't see, I don't believe they don't know."

In Chang's mind, she and Harrington had a symbiotic relationship. She brought in money and catered to his needs - when Harrington's Patek Philippe broke, she had it repaired; when his chief of staff's shirt cuffs were too wide, she had them fixed. He constantly scolded her but never stayed angry. Because, however unorthodox her methods, for years Chang looked like a good deal for the university. But in late 2007, Harrington finally learned of a fundamental problem with Chang's operations: she was spending almost as much as she was raising - she had averaged US$350,000 per year. Harrington admonished her once again.

As always, Chang reassured Harrington. "She said … 'I can always bring in more money,'" he testified. Two years later, she got lucky, notching a US$750,000 donation. Still, raising money had become more onerous. The trouble had started in 2003, when the Taiwanese government, which had been providing several hundred thousand dollars a year, stopped contributing - the Taipei Times reported that Chang tried to bribe local officials. Chang was left to prospect for donors in Europe and the Middle East. This was cold-calling, and it was frustrating work. Chang's secretary culled candidates from the Forbes list of the world's richest people, and then Chang wrote letters to a "beneficent luminary", as she called one, offering an honorary degree while pressing for a contribution. One recipient sensed a scam. "It appears that the honorary doctorates conferred by your prestigious university are generally on the basis of specific material contribution," he wrote.

On April 2, 2009, Chang e-mailed Harrington to suggest a new approach: what if they confirmed a date for the conferment ceremony and then in coming months "provide(d) with the opportunity to contribute"? If the proposed recipient balked, she wrote, "we will give him an excuse for cancelling [the ceremony]." Harrington e-mailed the following day that he was "very interested", but needed to speak to the board.

Chang's luck ran out on December 14, 2009, when a package from an anonymous sender arrived at the president's office, containing receipts from the Taishin credit card that were different from the ones Chang had submitted. She must have known that getting caught was inevitable. "This was an impossible operation to really run," said one investigator.

Towards the end, the pressure showed. For years, the amount she expensed matched "to the penny" what she laid out, even if she disguised the true charges. But she complained to a friend that she needed more money, in part because, she claimed, "I don't know how to pay for all these expenses". She meant the gifts. By 2008, she was billing the university for much more than she was spending on the credit card and pocketing the difference. And it wasn't merely to pay for gifts. She was gambling more than ever, and clearly she was losing.

On January 6, 2010, St John's told Chang she was suspended without pay. In e-mail after e-mail, she begged Harrington to handle the matter internally. By then, though, it was out of his hands.

Once, Chang had been the hostess of every party, picking up every bill. Now she was isolated. Her beloved son had relocated to Hawaii, where he landed a job as an attorney. Towards the end, she decamped to Foxwoods, the casino. "They have VIP lounge is very nice, 24 hours food, the atmosphere very nice," Chang testified. She was drinking heavily, so much that she couldn't co-operate in her own defence, her lawyers told a judge, who remanded her to the Manhattan Detention Centre to dry out. Chang was discussing a plea deal - and probably could have done a few years in a federal camp - but she refused. She hated her brief stay in jail - mainly, Mahler thought, because she couldn't tend to her appearance.

Despite the counsel of her three lawyers, and the urging of her son, Chang took the witness stand, though she faced up to 20 years if found guilty. "She was convinced she could sway the jury," said Mahler. Instead, her testimony buried her. She admitted again and again that she'd covered up the truth.

Her day in court over, Chang went to her home a few minutes from the St John's campus and prepared for her death. Years ago, she'd moved her parents' ashes to New York. "I feel very painful. I want to die. I want to be with my parents," she wrote in one suicide note.

In the aftermath, those at St John's who knew Chang best, who'd missed Chang's fraud for years while benefiting from her extravagant gifts, have continued to express surprise. "I really liked Cecilia," Harrington told the student newspaper in an unpublished interview after her death. "I kept saying, 'Something's going to come up here [to explain this]. I just can't believe Cecilia would do this.' I trusted her."

New York Magazine

 

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