Former 3M engineer accused of $5 million fraud

SIOUX FALLS, S.D. - A former 3M Co. engineer is accused of bilking the company of more than $5 million by billing it for specialized parts from phantom companies.

Court files show that David Beulke has agreed to plead guilty to mail fraud and make restitution.

No date has been set for a plea hearing in U.S. District Court in Sioux Falls.

A written plea agreement signed by Beulke includes forfeiture of $2.4 million the government said it has seized from various banking and investment accounts, and another $1.3 million -- minus taxes and other deductions -- from the sale of Brookings County real estate, personal property and equipment.

Federal prosecutors said Beulke, of Brookings, worked at a 3M plant in Brookings that manufactures medical and surgical products. They declined to discuss the case beyond their court filings.

Defense attorney David Palmer of Sioux Falls also declined comment Monday.

A message left at a phone listing for David Beulke in Brookings was not returned.

"He created businesses and held them out to 3M as legitimate vendors of specialized parts. The defendant caused 3M to place orders for supposed parts from his created businesses, knowing those orders were fraudulent," prosecutors said in a court filing outlining their case.

"He kept the money 3M sent for the supposed parts for his own personal use. He initially deposited the money into various accounts, spent some on purchases and other personal expenses, and transferred a large amount of those funds into a variety of investments and retirement accounts."

Mail fraud carries a maximum sentence of 20 years in prison and a $250,000 fine.