A former executive director of Queens Defenders and her husband are charged with embezzling $60,000 from the organization and spending it on personal expenses including rent for a penthouse apartment, luxury goods, vacations and teeth-whitening procedures, prosecutors say in an indictment unsealed Wednesday in New York federal court.

Lori Zeno, 64, of Garden City, Long Island, and Rashad Ruhani, 55, of Corona, Queens, are charged with wire fraud, theft of funds and conspiracy to commit money laundering during an eight-month period starting in June 2024. The government says they siphoned off tens of thousands of dollars from Queens Defenders, a legal aid service for the second most populous borough in New York City, which receives funding from the federal government and the New York City Department of Housing Preservation and Development.

The pair used the nonprofit's corporate credit cards on personal expenses, clothing stores, vacations and rent for the penthouse, which Ruhani claimed was being used for "foster parent care" services and "client defense," the indictment says.

They submitted bogus reimbursement forms for tens of thousands of dollars in personal expenses and pretended they were business-related expenses, prosecutors say.

Zeno is not in custody, federal prosecutors said Wednesday. Ruhani was arrested Tuesday evening at John F. Kennedy International Airport after returning from California and is set to be arraigned Wednesday afternoon.

Doneath Powell, chair of the Queens Defenders board of directors, said in a statement Wednesday the organization is "deeply saddened" by the accusations against its former employees.

"Queens Defenders holds itself to the highest standards of ethics and accountability," Powell said. "The alleged actions do not reflect who we are as an organization or the values we uphold. This is a difficult moment, but we are committed to transparency, accountability and moving forward with strength and integrity."

The organization suspended Zeno on Jan. 30 after it identified irregularities and later fired her after a comprehensive independent forensic audit.

"Despite this development, Queens Defenders remains fully operational and unwavering in its mission," the organization said Wednesday. "The legal and community-based work carried out by its dedicated attorneys, social workers and support staff continues without interruption."

Zeno founded Queens Defenders in 1996 and was its executive director from 2018 until January. Ruhani most recently managed the organization's youth programs, according to the indictment, after joining the group in 2023 where he started off as a client advocate. The pair began dating while working together at Queens Defenders, the indictment says.

Last July, the couple spent $1,300 for meals at a high-end restaurant and a more than $6,000-a-month lease on the penthouse, the indictment says. Ruhani was listed as the tenant and submitted at least four sham reimbursement requests worth about $39,000, which he used to pay the penthouse rent.

"Moreover, the fraudulent reimbursement request forms submitted by Ruhani included a photographic excerpt of the lease agreement for the penthouse apartment that had been altered to remove Zeno from the list of occupants," the indictment says.

The couple charged at least $2,000 for parking near the penthouse that they claimed as business-related expenses, the indictment says.

Around that same time last summer, the pair also spent more than $5,200 at luxury shops and more than $1,300 at clothing stores. A card issued by the nonprofit to Ruhani was spent on more than $1,100 at another luxury store last fall and more than $2,600 at a steakhouse.

Ruhani and Zeno also spent more than $10,000 on a trip to Bali and $1,700 on a luxury resort in California, the indictment says.

Ruhani also used Zeno's corporate card to buy an 85-inch TV for $3,300 that was installed at the penthouse, the indictment says. The pair also spent $600 for teeth-whitening procedures.

Zeno has faced controversy before at Queens Defenders, during a unionization effort in early 2021 during which two pro-union employees were fired, which the union described a retaliation for their labor organizing.

At the time, the union said Zeno had told employees they didn't have to unionize because the legal aid service had only terminated six people in its 25-year history only. An organizer with the Association of Legal Aid Attorneys, a local of the United Auto Workers, had said alleged Zeno previously suggested unionizing would do a disservice to the organization and threaten its contract with the city, which the union dismissed as a "total scare tactic."

The union accused Zeno of firing one of the workers when she wouldn't say how she voted during the union election, a violation of the National Labor Relations Act.

In March 2021, attorneys and social workers at Queens Defenders voted overwhelmingly to unionize with the ALAA. Queens Defenders management did recognize the union.

"I am pleased that each eligible staff member had the opportunity to vote in a secret ballot election and respect their decision to unionize," Zeno said in a statement at the time. "Our leadership team is ready, willing, and able to expeditiously begin the bargaining process for the purpose of reaching an agreement."

Representatives for Ruhani did not immediately return requests for comment Wednesday. Attempts to locate a representative for Zeno were not immediately successful.

The government is represented by Russell Noble and Sean Michael Sherman of the U.S. Attorney's Office for the Eastern District of New York.

Ruhani is represented by James Lenihan of Lenihan & Associates LLC.

Counsel information for Zeno was not immediately available Wednesday.

The case is U.S. v. Lori Zeno et. al., case number 1:25-cr-00182, in the U.S. District Court for the Eastern District of New York.

--Additional reporting by Emily Lever. Editing by Brian Baresch.