These previous posts reported on the unusual case of Jonathan D. “Jody” Nelson, the former chief financial officer of Snyder, Texas (between Abilene and Lubbock)-based Patterson-UTI Energy, Inc., one of the largest land-based drilling contractors in the U.S.
Early last November, the 36 year-old Nelson resigned for “personal reasons” and, a day later, he made a regulatory filing of his intent to unload about $13 million of Patterson stock. That disclosure prompted the company to make a public announcement that it was investigating a “former executive” in connection with the alleged embezzlement of over $70 million from the company, which was followed a week or two later by the Securities and Exchange Commission commencing a lawsuit to freeze Nelson’s assets. A day later, Nelson was named in a federal criminal complaint accusing him of falsely certifying an SEC report.
Well, Clear Thinkers favorite Peter Henning reports that Nelson has finally admitted to the scam and entered into a plea deal with federal prosecutors. This press release from the U.S. Attorney’s Office for the Norther District of Texas confirms that Nelson pled guilty last Thursday in Lubbock federal court 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. Nelson faces a maximum sentence of 30 years in prison and a $500,000 fine.
Nelson’s scam was accomplished through through a bogus invoice scheme that had shell companies under his control receive Patterson-UTI money, which Nelson then spent on an airplane, an airfield, a cattle ranch, a truck stop, homes and vehicles. In case you were wondering, PriceWaterhouseCoopers, LLP. were the auditors who failed to notice that a 36 year-old CFO of the company was living rather large, at least by Snyder, Texas standards.