Plea in federal case brings $1 million in restitution, back taxes
URBANA — A Mansfield man who admitted stealing from his employer for years will have to pay more than $1 million in restitution and back taxes.
Neal Freeman, 59, had worked for Champaign Builders Supply at 30 E. John St., C, for more than 30 years when his theft was uncovered in early 2011 by the late owner's daughter.
Freeman pleaded guilty Tuesday in U.S. District Court in Urbana to wire fraud and filing false income tax returns in connection with almost $1 million he stole from the business between 2003 and 2010.
Under the terms of his plea agreement, negotiated by Assistant U.S. Attorney Elly Peirson and Urbana defense attorney Tony Novak, Freeman will have to repay the construction company $860,622. He'll have to pay the federal government $189,085 in back taxes for income he failed to report for six years beginning in 2005.
He also faces between 33 and 41 months in prison and up to three years of supervised release. Although U.S. Magistrate Judge David Bernthal accepted the plea agreement, Judge Michael McCuskey is scheduled to sentence Freeman on Oct. 4.
The plea agreement that Freeman entered into said that Champaign Builders Supply owner Don Blager died in March 2002, leaving his share of the company to his wife. Their daughter, Marsha Elliot, of Hinsdale, was on the board of directors of the company. Mr. Blager had owned the company since 1973 and had hired Freeman in 1979 right out of college.
It was the last week of January 2011 when Elliot launched a review of the company's financial statements to try to find out why the cash losses were so great. What she found prompted her to contact Champaign police.
Detective Pat Kelly then began his own investigation to supplement Elliot's that led to Freeman's indictment in February 2012 on 28 counts of wire fraud and six counts of filing a false income tax return.
Kelly learned that between August 2003 to January 2010, Freeman wrote more than 286 checks on the company account to himself for a total of more than $780,000. Freeman created false ledger entries to make the checks look like normal business expenses, when in fact, the money went into Freeman's personal account at Busey Bank. Another approximately $200,000 in checks were written to third parties to pay for items that benefited Freeman.
Kelly learned that Freeman spent the company's money on home improvements, a 2004 GMC Envoy, a 2006 GMC Sierra pickup, a 1995 Ford motor home, a Bobcat, and new cabinets for his garage.
He admitted that he never reported the stolen money as part of his income, prompting the false income tax return charges.
Elliot said on Tuesday that her 87-year-old mother still owns Champaign Builders Supply and that the company is keeping its head above water but that the full amount of what Freeman stole will probably never be precisely known. To date, the company has not recovered anything from him.
"Will it ever fully recover? No. Are we still in business? Yes," said Elliot, who said she plans to attend Freeman's sentencing hearing.
"It's a sad situation."