News and Press Releases

Dothan Man Sentenced to Three Years Imprisonment for Embezzlement

November 4, 2010

Montgomery, Alabama - James E. Goldsborough, age 71, was sentenced by U.S. District Judge W. Keith Watkins to 36 months in federal prison for embezzling funds from PeoplesSouth Bank ((PSB), U.S. Attorney Leura G. Canary announced today.

On July 19, 2010, Goldsborough pleaded guilty to a one-count felony information charging him with embezzlement of funds by a bank employee, in violation of Title 18, United States Code, Section 656. According to court records, Goldsborough worked for PSB in Dothan since 1992–first as President and, later, Executive Vice President. In these positions, Goldsborough had the authority to approve loans up to $25,000.

Goldsborough began embezzling in approximately 1992. He accomplished this by opening a bank account in the name of the fictitious entity. He would then approve loans to fictitious borrowers in amounts of $25,000 or less, deposit the loan proceeds in the account, and use the money either for personal expenses or to repay previously obtained fraudulent loans. Goldsborough would occasionally receive the loan proceeds in cash, falsely representing to the teller that he intended to personally deliver the funds to the borrower. Goldsborough classified the loans as commercial loans because there was no minimum monthly payment–the only requirement was that the loan be paid in full when due. When a loan would become due, Goldsborough would arrange for a new fictitious loan and use those funds to pay the loan that was due. Goldsborough also used his knowledge of PSB’s security procedures to avoid certain anti-fraud measures.

At the time Goldsborough's embezzlement scheme was detected in August 2009, PSB’s records show that approximately 92 fictitious loans were outstanding with a total principal balance of approximately $1,850,999.23.

The case was investigated by the Federal Bureau of Investigation and was prosecuted by Assistant U.S. Attorney Andrew O. Schiff.


Telephone: (334) 551-1755
Fax: (334) 223-7617

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