Updated, 1:15 p.m. | The United States attorney’s office in Manhattan plans to announce this afternoon the arrests of four people — two officials of the Administration for Children’s Services, one employee of a nonprofit foster care agency in Brooklyn and one independent contractor who had his office in that agency — on charges that prosecutors say stem from the embezzlement of money intended to assist needy children.

A federal complaint made public on Wednesday morning said that one of the A.C.S. officials admitted in an interview with prosecutors to have participated in two separate criminal schemes while working at the city agency, which oversees the adoption and foster care system.

One was a scheme to fraudulently obtain tens of thousands of dollars of government adoption subsidy payments which were intended for parents of adoptive children, some of whom had mental and physical disabilities.

The other was a scheme to embezzle hundreds of thousands of dollars from A.C.S. by authorizing payments for fictitious services that were never provided.

The official, one of those charged, is Lethem Duncan. Since 1998, Mr. Duncan has served as deputy director of the payment services department of A.C.S., a job in which he had the power to authorize payments to nonprofit foster care agencies and their contractors.

The criminal complaint says that Mr. Duncan has been cooperating with the City Department of Investigation “in the hopes of obtaining a reduction in his sentence.”

A Children’s Services spokeswoman, Sharman Stein, declined comment on Wednesday morning.

The Brooklyn foster care agency, where two people were also charged, is Concord Family Services Inc. on Bedford Avenue in Bedford-Stuyvesant.

The criminal complaint described an extraordinary fraud scheme that involved computers and setting up of fictitious names of adoptive parents. The money was intended to go for the care of children with very real vulnerabilities, like mental or physical disabilities.

The complaint says that in 2005, another A.C.S. official, Nigel Osarenkhoe, who was supervisor of adoptions within the payment services department, told Mr. Duncan that he had figured out a way to manipulate the agency’s computer systems to cause adoption subsidy payments to be mailed to whomever he wanted.

All he needed, Mr. Osarenkhoe told Mr. Duncan, was “a name” and he could cause additional adoption subsidy payments to be issued, the complaint says.

It says Mr. Duncan later spoke with one of the Concord employees, Stay Thompson, and she agreed to have Mr. Duncan provide Mr. Osarenkhoe with her name and address as part of the scheme. Ms. Thompson then agreed to split the adoption subsidy payments she received evenly with both A.C.S. officials.

According to Mr. Duncan, Mr. Osarenkhoe had about $79,000 in adoption subsidy payments sent from A.C.S. to Ms. Thompson, who shared the stolen money with both A.C.S. officials.

Mr. Osarenkhoe and Ms. Thompson have also been charged in the case.

The complaint, filed by the office of United States Attorney Michael J. Garcia, says that as part of his cooperation with the authorities, Mr. Duncan met with Mr. Osarenkhoe on March 24, and asked him whether he could “reactivate that ’stuff we did’,” a reference to the scheme.

The meeting was being secretly recorded by the authorities.

In the meeting, Mr. Duncan proposed adding a new person, a friend of his, to receive adoption subsidy payments.

Mr. Osarenkhoe agreed, but expressed concern that adoption subsidies were being looked at more closely now that “they are doing the checking.”

Prosecutors say that they believe Mr. Osarenkhoe was referring to stricter controls A.C.S. has put in place in response to the case of Judith Leekin, a former Queens woman who adopted 11 children under four aliases and collected about $1.68 million in subsidy payments that were meant to care for the children. Instead, she used the money to support a lavish lifestyle. Ms. Leekin was sentenced on Tuesday to 10 years and 10 months in prison.

The next day, Mr. Duncan gave Mr. Osarenkhoe the name of his friend, which in fact had been supplied by the Department of Investigation.

The other scheme began with a request from Ms. Thompson, prosecutors say. She has been the fiscal director at Concord since 2002.

Concord has received more than $28 million since 1990 in contracts to provide foster care and other services to needy children in New York City, the complaint says.

The document says the scheme unfolded this way: On several occasions in 2004, Ms. Thompson told Mr. Duncan that she had stolen money from Concord’s petty cash fund; and in 2005, she told him that she needed to repay the money because Concord was being audited and
she was concerned that her thefts would be discovered.

Mr. Thompson proposed to Mr. Duncan that they embezzle money from A.C.S., by having the agency issue an unauthorized payment for services run by an acquaintance.

She was referring to Philbert Gorrick, the complaint says, who is the fourth defendant charged in the case. Mr. Gorrick runs a company called Contemporary Technologies, which provided computer services to Concord, and had an office in the agency.

According to the complaint, Mr. Duncan agreed to have A.C.S. issue a check in the amount of $375,000 to Mr. Gorrick’s company. The document says he instructed two subordinates to approve the payment, although Mr. Gorrick’s company had not provided any services or products to Concord in connection with the payment.

After receiving the $375,000 payment, Mr. Gorrick divided the proceeds with the Concord fiscal director, Ms. Thompson, and Mr. Duncan. According to Mr. Duncan, Mr. Gorrick provided them with checks that totaled more than $100,000.

The document says that Mr. Gorrick also used a part of the $375,000 in stolen A.C.S. money to pay for items like a 2006 BMW 750 LI sedan worth $84,500, a 2006 Range Rover, and at least $30,000 in rent for an apartment in a doorman building with a private garage.

A person who answered the phone at Concord on Wednesday said that there was no one available to answer questions on the matter. Lawyers for the four defendants could not immediately be identified.

The allegations of spending problems at Concord are not new. Late in 2006, the executive director at Concord resigned after an audit by the city comptroller’s office found that she had spent tens of thousands of dollars at luxury retailers using the midsize agency’s credit card.

(Editors’ note: The Times published “A History of Neglect,” a three-part series of articles last November, about the struggles of minority-run foster care agencies in New York City. It found a trail of scandals and disappointments, as well as a new commitment to better caring for the city’s vulnerable black and Latino children.)