Yesse Yehuda, the politically-connected head of the FORUM non-profit, has been charged by federal authorities for misappropriating $200,000 in funds earmarked to develop south suburban properties and fund a workplace training program.
Yehuda has been charged with eight counts of bank fraud and seven counts of wire fraud.
Where Did the Money Go?
The charges allege that FORUM (Fulfilling our Responsibilities Unto Mankind) received three state grants totaling just under $600,000 from 2013 to 2016 from the Illinois Department of Commerce and Economic Opportunity. Two of the grants were earmarked for development projects in cash-barren Dolton while the third was earmarked for job training related to weatherization jobs.
The indictment claims that Yehuda made false statements and issued fake reports related to how the money was being spent. In one case, FORUM claimed that they had spent $100,000 to develop a vacant lot in Dolton, but no construction was ever performed.
In another instance, $20,000 was spent to help Yehuda purchase a condo for a family member of an associate, the indictment claims. Federal authorities claim that Yehuda hid the fraud by cutting the associate a cashier check who then endorsed it to Yehuda.
Lastly, the indictment claims that Yehuda inflated costs related to subcontractors and then pocketed the difference.
Yehuda is a prominent figure in the area with major political connections to local politicians. Authorities say he used his connections to secure grants issued by the state to improve the area, but instead used that money as he pleased and, in fact, lied on official documents to prevent the government from finding out.
Some of the most severe charges have maximum penalties of 30 years in prison. Since Yehuda is facing federal charges, he will be subject to federal mandatory minimum sentences and could end up facing considerable time in prison.
As the leader of FORUM, Yehuda had access to taxpayer-funded grants meant to improve the community. This is not, however, the first time that Yehuda has faced legal problems concerning the management of state funds.
In 2002, Yehuda was sued by then-Attorney-General Jim Ryan. Ryan sued Yehuda and another charity operator after they misappropriated funds from similar restoration public interest initiatives. The lawsuit accused the men of using their charities to launder money and that they used funds for public projects as their personal piggy bank. Yehuda settled the lawsuit after agreeing to give $10,000 to charity.
While it is not entirely clear to authorities where some of the money went, the general belief is that Yehuda used the money to solidify for non-grant-related purposes. If true, Yehuda could face felony fraud charges.
Talk to a Chicago Criminal Defense Attorney Today
If the feds are accusing you of scamming your own charity, then you need an attorney who is capable of defending you from federal charges. Call David Freidberg today at (312) 560-7100 or talk to us online to schedule an appointment. We can help.