Risk Management

Ex-CFO Gets 25 Years for Embezzlement

"We are at a crossroads in America where malfeasance in corporate America has reached an all-time high," judge says.
Stephen TaubOctober 10, 2006

A former finance executive of an energy company was sentenced to nearly 25 years in prison for embezzling more than $77 million from his employer, according to the Associated Press.

Jonathan Nelson, a 36-year-old ex-CFO of Patterson-UTI Energy Inc., was also fined $200,000 and ordered to pay about $77 million in restitution, minus the money that was recouped from the sale of assets Nelson had purchased with the stolen money, the wire service reported.

Nelson reportedly spent the money on an airplane, an airfield, a cattle ranch, a truck stop, homes, and vehicles. Speaking in court before the sentencing, Cloyce Talbot, Patterson’s president and chief executive of the oil and gas drilling company, called Nelson a “sophisticated, high-dollar con man,” who before the embezzlement came to light had become “like a son to me,” according to AP.

“I’m not here to talk about money: what we’ve lost can’t be measured in dollars,” Talbot reportedly added. “Jody [Nelson] stole reputations that I will not live long enough to rebuild. We all trusted Jody. I can’t tell you how many people he betrayed.”

Nelson’s embezzlement was “not fueled by greed or maliciousness,” he reportedly told the court. “I am truly very sorry and ashamed of my betrayal.” he reportedly told the court.

In April, Nelson pleaded guilty to one count of wire fraud and aiding and abetting; and one count of engaging in monetary transactions derived from specified unlawful activity and aiding and abetting, according to the AP.

The judge in the case saw a broader trend in Nelson’s action. “We are at a crossroads in America where malfeasance in corporate America has reached an all-time high,” U.S. District Judge Sam Cummings reportedly said in comments to Nelson. “This type of conduct simply cannot be tolerated in our society.”