The former controller of a Shelton outdoor equipment manufacturing company was sentenced recently to 12 months and one day in prison and three years of supervised release for an embezzlement scheme that stole more than $665,000 from the company, the U.S. Attorney’s Office announced in a news release this week.
The case was investigated by the Internal Revenue Service Criminal Investigation, the FBI and the Mason County Sheriff’s Office.
Jesse Arden Sherman, 63, of Elma, illegally diverted company funds to his own accounts between 2012 and 2018. In addition, Sherman failed to pay taxes on his ill-gotten gains, resulting in a tax debt of $202,196. At the sentencing hearing this week, U.S. District Judge Tiffany M. Cartwright emphasized the economic and non-economic losses experienced by the victim company and its employees.
Sherman’s fraud resulted in a loss to the company of at least $665,840. As a certified public accountant, Sherman knew that he owed taxes on the money he obtained by fraud, but he failed to pay the $202,196 he owed on his taxes between 2013 and 2018, the news release stated.
In asking the court for an 18-month prison sentence, prosecutors noted that Sherman betrayed his employer’s trust month after month with each fraudulent check or entry in the company books.
“Despite personal and professional privileges, Sherman elected to create a multi-faceted fraud scheme, which he deployed repeatedly over the years to unjustly enrich himself,” the news release stated. “Although he claims his gambling drove his behaviors, Sherman had the means and self-recognition to address this issue and instead of doing so he instead recommitted to his scheme over and over again.”
Sherman has agreed to make restitution to the company of $665,840 and to the IRS of $202,196.
The case was prosecuted by Assistant United States Attorney Brian Wynne.
