More than 30 years after con man Coy Everett bilked 650 investors out of about $29 million, the fraud remains the single largest oil and gas investment scam in the history of Central Oklahoma.
After serving two lengthy prison terms, first for the oil and gas scheme and later after conviction on charges of theft and fraud, Everett, 58, has returned to prison for a third time.
He was convicted of embezzling money in 2011 from the town of Hominy in Osage County, where he served as public works director after his second release from prison.
Everett worked for Hominy, a town of about 3,500 people, for more than a decade before city staff discovered he had forged five or six checks for about $33,000 over a period of about a month, Hominy City Manager Tex Bayouth said.
Bayouth's predecessor hired Everett to work at the town's wastewater treatment plant soon after his release from Dick Conner Correctional Center in Hominy. Over a period of several years, Everett worked his way up to become the head of the community's public works department.
A regular churchgoer in Hominy, Everett was well liked at work and was open about his past run-ins with the law, Bayouth said.
“He was very intelligent — very knowledgeable,” Bayouth said. “He didn't mind sharing about his past; he was active in his church and would give his testimony about it.”
Everett, a former high school football star in Shawnee, was only 27 when his $29 million fraud was uncovered in 1981 by state securities regulators. He promised investors returns of up to 150 percent for involvement in his two companies, Freedom Energy Corp. and CSC Oil Co.
However, the companies never turned a profit and the venture evolved into a Ponzi scheme, according to newspaper archives. Everett bought only a handful of oil and gas leases and spent most of his time trying to lure in new investment money. The scam grew as Everett had to continue to bring on new investors to pay earlier backers of the fraudulent companies.
In a court affidavit admitting his guilt, Everett said he never put much of his investors' money back into his companies for legitimate business purposes, but instead used the ill-gotten funds to prop up a facade of success.
“So long as I was able to encourage even larger numbers of people to participate in my ventures, I could maintain the image of a successful businessman operating a growing and profitable enterprise,” Everett said in the affidavit. “Every time that I would return a so-called profit to a participant in my programs, I became much deeper in debt.”
Everett pleaded guilty to fraud charges in 1982 and was sentenced to 15 years in federal prison.
Records show that Everett was released from prison on probation in 1989, but quickly ran afoul of the law again. In 1992, he was charged with writing $50,000 in payroll checks to himself from an Oklahoma City staffing company that hired him after his release from prison.
The fraud earned Everett a second stay in prison, at Dick Conner Correctional Center in Hominy, where he worked at the city's wastewater treatment plant on a work release program until his parole in 1999.
Everett had worked for Hominy for 11 years in 2010 when bookkeepers discovered that Everett had forged a number of checks from the town's accounts.
Although Everett had already paid the money back by the time the forged checks were discovered, Hominy turned the case over to the district attorney's office.
“I was very disappointed when we found out — he resigned immediately.” Bayouth said.
These days, Everett is an inmate at Jess Dunn Correctional Center in Taft, serving a 20-year sentence for forgery.
Everett will be eligible for parole again in 2016, when he will be 61.