Authorities have charged a retired Santa Clara Unified School District official with two conflict-of-interest felonies.

Prosecutors say Jinfa "Jim" Luyau, 59, as the district's Assistant Superintendent of Business Services, approved contracts that put thousands of dollars of public money into his own pocket. The money was supposed to go to the school district.

It's against the law for a public official to profit from any government contract he or she negotiates as part of the job.

“You are not allowed to profit by a government contract that you yourself made,’’ prosecutor Judy Lee of the Public Integrity Unit said. “There needs to be a set of checks and balances to make sure there is not a misuse of public funds.”

The alleged crimes came to light in 2011, during an internal audit that showed some unusual financial activity. Suspecting fraud, the county hired an independent auditor, who tipped off the District Attorney's Office.

Investigators found that Luyau, who retired in 2012, had negotiated and approved two contracts between 2006 and 2013 meant to pay the district for bookkeeping services provided by an outside vendor, the South Bay Areas School Insurance Authority. Luyau allegedly OK'd several checks to himself that amounted to more than $40,000.

If found guilty, Luyau faces a maximum sentence of three years and eight months behind bars. He's the second county official to make the news in the past couple days over allegations of corruption. John Vartanian, head of the Department of Child Support Services, was placed on paid leave after news reports found that he reaped travel rewards bonuses that should have gone to the county.

Luyau, arrested last week, is out of custody after posting his $20,000 bail. His arraignment is set 1:30pm Friday.