Good grief, what a jerk.
I'm afraid I've got to agree with Badger: start hunting for another job, partly because if he'd screw you like this once, he'll do it again; and partly because --- out of his own paranoia, if nothing else --- he'll be hunting for a reason, no matter how foolish, to fire you. It's silly, I know: all you did was come to work on time and do your job, and it's cost you $500 and all your respect for your boss.
On the bright side: HE'LL be stuck with his idiot nephew.....