A former Cummins Inc. employee has been sentenced to more than five years in federal prison for stealing more than $4.8 million from his employer over a nine-year period.
David Hudson, 56, of Columbus, Ohio, was sentenced Wednesday in federal court in the Eastern District of Michigan. In addition to the 63 months of prison time, he was also ordered to pay restitution of $4.86 million and to serve two years of post-incarceration supervised release.
The case was tried in Michigan because Hudson was working for Cummins in New Hudson, Michigan, when the fraud occurred. Hudson pleaded guilty to one charge of wire fraud in January 2020, but the pandemic delayed his sentencing until this week.
Prosecutors say the fraud started when Hudson was working for Cummins Bridgeway LLC, a company that had four owners—including Cummins Inc., which owned a 46% share. In 2014, Cummins acquired the company outright. Hudson began working for Cummins Bridgeway in 2003 and remained with the company until 2018, when he was terminated because of the fraud, a sentencing document says.
According to prosecutors, part of Hudson’s job was to transfer funds to two entities for the purpose of sharing company profits with managers and employees. Between 2008 and 2017, Hudson wrote unauthorized checks to himself from these entities.
A court document says that Hudson used the money to purchase dozens of luxury watches, expensive wine and liquor, designer clothing and a Cadillac, and that he “curried favor among his coworkers” by giving them expensive gifts.
“The entirety of his personal identity was seemingly linked to the luxury lifestyle enabled by his theft,” the sentencing memo says.
In an emailed statement, Cummins said, “This was an unfortunate incident for Cummins, but we are very pleased with the ruling. Integrity is core value of our company and we are committed to upholding it. We appreciate the efforts of the employees who helped us uncover this case of fraud and the ongoing efforts of all our employees to uphold our values and prevent other such incidents from occurring.”