Chicago Bizman Sentenced for $950K Embezzlement Scam

CHICAGO — In a stunning turn of events, Donald E. Mudd, 66, has been handed down a sentence of over a year in federal prison for masterminding a $950,000 embezzlement scheme that targeted a New York-based sealant manufacturer.

Mudd, who previously operated two companies, Mudd-Lyman Sales and Services and Simply Service LLC out of Skokie, Ill., pleaded guilty to mail fraud charges earlier this year. On June 21, 2024, U.S. District Judge Elaine E. Bucklo sentenced him to 15 months in federal prison, imposed a fine of $60,000, and ordered Mudd to pay $951,755 in restitution.

The defendant’s scheme involved a partnership with Rodney Hawkins, 57, a vice president at the New York-based company. Together, they concocted a plan to embezzle funds from Hawkins’s employer by inflating commissions and submitting false invoices for services that were never rendered. The duo then divided the illicit proceeds.

Hawkins, who resides in Newton, N.C., has already pleaded guilty to his role in the scheme and is currently awaiting sentencing.

Mudd’s sentence was announced by Morris Pasqual, Acting United States Attorney for the Northern District of Illinois, and Robert W. “Wes” Wheeler, Jr., Special Agent-in-Charge of the Chicago Field Office of the FBI. Assistant U.S. Attorney Michelle Petersen represented the government in this case.

This is a stark reminder of the lengths some will go to for financial gain, and it serves as a cautionary tale for all business owners and executives about the importance of stringent financial controls and due diligence in their operations.