Omaha priest gets probation; gave homeless man $700k

Fr. Michael Gutgsell stole from an elderly priest with dementia, and from his parish, to give money to a local homeless man.

An Omaha priest pled guilty last month to two misdemeanor charges of theft, almost two years after he was charged with stealing nearly $200,000 from an elderly priest. The priest was also accused of stealing thousands from a Nebraska parish where he was pastor.

Fr. Michael Gutgsell. Courtesy photo.

Fr. Michael Gutgsell, 74, pled in a Douglas County courtroom June 29 to two misdemeanor counts of theft, and was sentenced to two years of probation. The priest was initially charged in December 2021 with a felony count of theft along with the abuse of a vulnerable adult — and could have faced five years in prison if convicted of those charges.

According to charging documents, Gutgsell gave the stolen money, along with hundreds of thousands from his own savings, to an Omaha homeless man whom he apparently believed would pay him back.

The Omaha archdiocese told The Pillar it cannot yet comment on whether the priest will face canonical charges. But Gutgsell is presently prohibited from public ministry, the archdiocese confirmed.

Gutgsell was chancellor of the Omaha archdiocese from 1994 until 2003. He subsequently served as the pastor of several parishes in the Omaha archdiocese.

According to charging documents, Gutgsell took advantage of Fr. Ted Richling, an elderly priest for whom Gutgsell had power of attorney, ostensibly to assist Richling in the management of his finances. Prosecutors said that Gutgsell used his position to take at least $154,732 from Richling’s bank account. 

In addition to the theft, prosecutors charged Gutgsell with exploiting Richling, whom prosecutors classified as a “vulnerable adult.” 

Gutgsell was also charged in a different Nebraska county with stealing at least $96,400 from St. Joseph Church in Springfield, Nebraska, where the priest had served as a pastor. That charge was dropped in March 2022, after Gutgsell repaid his former parish the money.

While Gutgsell appears to have stolen more than $250,000 in total, the priest has insisted he did not keep the money for himself. Instead, according to charging documents, he gave the money to Michael Barrett, of no fixed abode, whom Gutgsell met in 2013, when the priest was pastor of Omaha’s cathedral.    

Gutgsell began in 2014 paying some bills for Barrett, whom he believed was “a very sick homeless individual in need of his assistance,” according to police reports. 

The priest apparently paid the homeless man roughly $700,000 between 2013 and 2021, according to charging documents, draining his own savings, and taking money from his parish and from Richling. Gutgsell told police he initially believed that Barrett was awaiting access to social security and disability funds, and needed support only to tide him over. He told police that he expected to be paid back for the money he gave Barrett. 

Gutgsell said he would give Barrett the money in cash dispersals, usually meeting in or near Gutgsell’s car parked in a downtown Omaha lot.

According to charging documents, Barrett is a fixture in casinos outside Omaha, and is usually seen in a suit and sunglasses.

Gutgsell told police repeatedly that he was not being blackmailed by Barrett.

Instead the priest insisted that he continued to believe the homeless man would repay him after his disability funds became available, but that repayment was delayed by a series of complications. 

Gutgsell’s attorney told local media in 2021 that his client was simply “scammed.”

When Gutgsell transferred money from Richtling’s accounts in 2018 and 2019, the elderly priest was suffering from Alzheimer’s disease and dementia, and did not possess the ability to make decisions. But Gutgsell told police that he considered the money taken from Richtling to be loans, which he intended to pay back. 

Gutgsell was caught in 2021, when archdiocesan audit procedures brought to light that the priest had stolen from the parish where he was pastor. 

Riley Johnson, a spokesman for the Omaha archdiocese, told The Pillar that “the Archdiocese of Omaha takes great care to ensure we are a good steward of the funds entrusted to us, and our teams assist parishes in doing the same.” 

“These oversight systems are routinely evaluated because no process can be immune to malfeasance when humans are involved. But in this particular case, the archdiocese’s financial audit function, review of internal controls and ongoing parish training helped bring this issue to light. Law enforcement was immediately notified, and Fr. Gutgsell was promptly removed from public ministry when financial issues were flagged,” Johnson added.

Gutgsell does not presently have faculties for public ministry in the Archdiocese of Omaha, and financial misconduct can be tried as a serious crime in the Church’s canon law.

Johnson told The Pillar that “the Archdiocese of Omaha Clergy Misconduct Board will review Fr. Gutgsell’s case in September,” and that the archdiocese could not confirm whether Gutgsell will face a canonical trial until after that meeting.

Richling, the priest from whom Fr. Michael Gutgsell stole, died in 2019. After his death, the archdiocese said it had received allegations that Richling had committed sexual misconduct with minors. Those allegations, the archdiocese said, have been “substantiated” — though it is not clear what, precisely, that term signifies.

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Robert Warren, a professor of accounting at Radford University, is a retired IRS investigator with an expertise in forensic accounting and the financial fraud perpetrated by priests.

Earlier this year, Warren and co-author Timothy Fogarty, a professor at Case Western Reserve University, published a comprehensive study, “Exploring Embezzlement by Catholic Priests in the United States: A Content Analysis of Cases Since 1963,” in the Journal of Forensic and Investigative Accounting.

In a thorough study of theft by priests since 1963, Warren found that more than 90% of priests were serving in parish ministry at the time of their crimes, in which an average amount of nearly $500,000 was stolen, at a median amount of more than $230,000, over an average period of 6 years.

But even while administering parishes presents a target-rich environment for fraud, Warren’s research has found that the data “does not attest to whether Roman Catholic priests are more or less honest than other groups.”

Warren’s peer-reviewed article on the subject added that financial crimes were found to have been only committed by a “small fraction of all priests.”

Indeed, the evidence suggests that the priesthood does not attract intentional fraudsters, or those necessarily predisposed to theft. Were that the case, one would expect to see instances of theft arise in the early years of ministry, or begin when the opportunity first presented itself.

Instead, the article said, the cases examined took place later in a priest’s ministry, at an average age of 52 and after an average of more than two decades in ministry.

Warren told The Pillar that Gutgsell’s case “is atypical in the sense that… Father Michael did not spend the money on himself, he had dissipated his personal funds first, and he thought he was going to get repaid.” 

Warren noted one other case in which a priest stole from a fellow priest with dementia. In that case, which occurred in the Diocese of Madison more than 10 years ago, the thieving priest spent time in jail for his crime, and eventually returned to parish ministry. 

Warren said his experience leads him to “predict that Father Gutgsell's priestly faculties will be restored at some point and he'll be back in the pulpit very soon.”

But Warren said that the probation sentence in Gutgsell’s case might not serve the public interest. 

“Criminal sentences serve the dual purposes of ‘particular and general deterrence,’” he explained.

“In other words, the sentence should be imposed to make sure the offender doesn't commit the crime again, and the sentence should provide a deterrence for those in similar circumstances. I think the probation sentences that are commonly imposed serve the particular deterrent, but I don't see how they serve as a general deterrent.”

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Gutgsell’s case, while unusual, is not the first instance of clerical criminality in his family. 

Fr. Stephen Gutgsell, Fr. Michael’s brother, was sentenced in 2007 to five years probation, after he admitted stealing $125,000 from the Omaha parish where he served. Fr. Stephen Gutgsell was returned to parish ministry some six months after his guilty plea, and is now the administrator of an archdiocesan parish.