Not-for-profit leader gets home incarceration for scamming state out of $260,000 in grant funds

A federal judge Tuesday gave six months of home incarceration to the leader of a Chicago not-for-profit who admitted stealing more than a quarter-million dollars in economic-development grant money from the state of Illinois.

Yesse Yehudah, 74, will also spend the next three years on probation, U.S. District Judge Andrea Wood ruled. Yehudah pleaded guilty to wire fraud in February, admitting he scammed the state out of $261,476 that had been awarded to his organization, Fulfilling Our Responsibilities Unto Mankind, or FORUM.

Yehudah’s defense attorney, Mary Judge, asked Wood for probation, insisting Yehudah is in poor health and that the amount of money stolen through the scam does not measure up in the context of typical fraud cases seen at the Dirksen Federal Courthouse.

Assistant U.S. Attorney Sean Franzblau insisted that Yehudah "was stealing from a charity" that had been entrusted with the "very, very limited amount of public money" made available to "do the most good with it." The prosecutor told the judge she had "a rare and important opportunity" to send the message that people who commit crimes like Yehudah’s "will pay a price."

But Wood said she considered Yehudah’s age, lack of criminal history since the 1960s and the fact that he had repaid some of the stolen money as she decided not to send him to prison. Yehudah has already repaid more than $90,000, and the judge ordered him to pay the remaining $170,000 in restitution.


Before he was sentenced, Yehudah told the judge that, "given an opportunity, if God’s willing," he would pay back what he owed. He also apologized for his "wrong choices."

The judge concluded the hearing by saying Yehudah’s was an "unusual case." She said she didn’t think "it would have been appropriate to impose upon Mr. Yehudah a greater sentence than what’s necessary simply out of the concern — or largely out of the concern — for sending a message to others."

To pull off his scheme, Yehudah submitted bogus status reports to the Illinois Department of Commerce and Economic Opportunity, claiming that money from three grants awarded to FORUM was being spent according to approved budgets.

In what Franzblau called a particularly "brazen abuse of trust," Yehudah used $20,000 from one grant to make a personal loan to a friend for a home purchase, records show. Then, Yehudah tried to collect rent, according to authorities.

Yehudah allegedly told the state he paid that person to teach a jobs-training program.

"It just doesn’t get more cynical than that," Franzblau said.

Yehudah also used $65,000 to make rent payments to MTW Consultants and the Urban Institute, without disclosing to the state that he owned those entities, according to his plea agreement.

Even though Yehudah pleaded guilty, Wood asked Judge about the undercurrent in a nine-page letter Yehudah wrote. The judge said it suggested that Yehudah committed his crime "for the greater good."

Yehudah wrote in the letter that he "took short cuts" while trying to build a workforce within the Black community. He wrote that he thought "the ends justified the means because I was working so hard and was doing so to help the community."

Judge acknowledged that Yehudah "doesn’t view himself as a criminal" but agreed that his conduct broke the law — something "he had to really come to terms with."