The former head of NI Water was convicted of embezzling £2,000 from a church in his native Scotland in 1982.
Laurence MacKenzie resigned last week after NI Water was severely criticised for the its handling of the water crisis.
The details emerged after SDLP MP Alisdair McDonnell asked Environment Minister Conor Murphy to confirm whether he had prior knowledge of his spent criminal conviction.
NI Water have refused to comment.
Mr Murphy has yet to comment on the issue but a Department for Regional Development spokesperson said:
"The Minister was not aware of this issue until it broke in the media today. He is advised by NI Water, as the employer, that it is currently looking into the matter."
It emerged that Mr MacKenzie stole from his congregation while a treasurer in a Church of Scotland in Caithness in the north of the country.
Subsequent to his conviction, Mr MacKenzie studied accountancy at the University of Abertay before a career in privatised utilities eventually saw him in charge at Northern Ireland Electricity and most recently NI Water.
Last March Mr MacKenzie stood in judgement of four NI Water directors whom he insisted were sacked over issues connected with the awarding of contracts.
Forty thousand homes and businesses were cut off from the mains during the recent crisis which happened after a rapid thaw caused pipes to burst across Northern Ireland.
NI Water was heavily criticised for its response, answering only a small proportion of the public's requests for help.
Following his resignation, Mr MacKenzie said his staff had made "tremendous efforts" but added that he "believed firmly in the principles of responsibility and accountability".
No details of his pay-off were published but the minister responsible for NI Water, Conor Murphy, said his understanding was that the minimum legal requirement would not include "pension contributions, golden handshakes or bonuses".
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