Dubuque man will serve two years in federal prison for embezzlement 

CEDAR RAPIDS - A Dubuque man who embezzled over $365,000 from an excavating company was sentenced Tuesday to more than two years in federal prison.

Michael Schute, 51, former controller of Tschiggfrie Excavating from 1988 to 2013, pleaded guilty in February to one count each of wire fraud and filing a false tax return, according to the plea agreement. Schute, who was responsible for the daily cash flow and authority to write checks for the company, embezzled money from 2008 to 2013.

According to the plea, Schute wrote company checks to pay for his personal credit card bills. He also falsified ledgers to make it appear that the funds were used for company expenses to conceal his scheme.

Management at Tschiggfrie discovered the fraud in April 2013, after finding discrepancies in the expenditures reflected on the books, according to the plea. Schute confessed to the embezzlement during a phone conversation with one of the owners of Tschiggfrie. He was fired after the call.

According to the plea agreement, Schute stole about $365,417 throughout the five years. During this same time, he filed false tax returns because he failed to declare the money he embezzled. If Schute would have filed all taxable income, it would have resulted in additional taxes owed on about $86,347.

U.S. District Chief Judge Linda Reade ordered Schute to pay restitution of $306,848 to the company and its insurance company. He had already paid $56,000 in restitution.