After a nearly two-year investigation, the former manager of the Woodlake Homeowners Association was booked into county jail Wednesday for allegedly embezzling nearly $2.8 million from the San Mateo residents’ group.

Susan Marie Lambert, a 64-year-old Fremont resident, has been charged with two felonies for conspiring to defraud the homeowners between Feb. 8, 2007, and September 2013, according to prosecutors.

Lambert’s alleged crimes were discovered after the 990-unit condominium association fired her and uncovered a stack of nearly 150 false invoices for construction work that was never completed, according to prosecutors.

Lambert pleaded not guilty after surrendering in court Wednesday morning and was booked on $1 million bail, according to prosecutors.

The San Mateo County District Attorney’s Office filed charges Sept. 1 against Lambert and her alleged co-conspirator Michael Anthony Medeiros, a 58-year-old Fremont man, who has yet to be arrested.

Faced with multiple enhancements, including aggravated white-collar crime, the duo could face nearly six years in prison if convicted, according to prosecutors.

Lambert and Medeiros reportedly conspired together while Lambert was in charge of the association’s finances and Medeiros was the owner of a painting company. Lambert would draft invoices for work, pay Medeiros, who would deposit the check into an account under his control, then split the money with Lambert, according to prosecutors.

“It’s obviously an enormous embezzlement. We certainly don’t see them of this magnitude very often,” said Chief Deputy District Attorney Karen Guidotti.

Officials with Woodlake turned information over to San Mateo police, who conducted an investigation before filing a report with the district attorney. Nearly two years passed since Lambert was fired before charges were formally filed.

“I’m very happy that finally justice may be done,” said Steve Davis, a member of the Woodlake Board of Directors.

The association, formed in 1987, oversees the 30-acre condominium community near Peninsula Avenue and Delaware Street that includes a slew of amenities. The site boasts a lake, five swimming pools, private courtyards, clubhouse, spa, 18-hole putting green, four tennis courts, two saunas, a gym and billiard room, according to the Woodlake website.

Lambert had worked for the association, which has a nearly $5 million annual budget, for more than a decade. She also received hefty compensation earning approximately $200,000 a year, Davis said.

“What’s amazing is that she was taking all this other money but that wasn’t good enough. And it was the small stuff that tripped her up,” Davis said.

The board originally caught wind of the theft when a member saw suspicious activity on a bank statement from the debit card Lambert was issued. She had made several withdrawals at various casinos, including Thunder Valley, as well as apparent personal purchases such as clothing, Davis said.

Lambert also initiated a board policy aimed at preventing members from speaking with vendors or contractors, Davis said.

For years, Lambert had firm supporters on the board and even claimed she was being harassed when someone would question her actions, Davis said.

In 2004, Lambert filed a lawsuit claiming defamation against two residents who accused her of taking “kickbacks” from a contractor, according to court records. That case never went to trial and was apparently settled through mediation, according to court records.

Lambert’s defense attorney did not return a request for comment.

Former and current Woodlake board members declined to comment, as the investigation is ongoing. Davis said the association has since made improvements such as hiring a new manager.

The case was continued to Oct. 1 for a pretrial conference and scheduled for a preliminary hearing Oct. 20.

As of Wednesday afternoon, she remained in jail on $1 million bail.

(650) 344-5200 ext. 106

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