PORTLAND — A Norway man was arrested Tuesday on felony charges of defrauding the federal government’s pandemic-prompted Paycheck Protection Program and filing a fraudulent application for a federally insured loan.
A federal grand jury indicted Merton E. Weed Jr., 50, this month on five counts. That indictment was unsealed Tuesday.
He appeared by videoconference at a hearing Tuesday before a magistrate judge in U.S. District Court where he pleaded not guilty to all five counts and was released on a $20,000 unsecured bond.
Weed filed five applications for Paycheck Protection Program loans seeking more than $150,000 between May 2020 and January 2021, according to court papers.
Investigators allege applications listed false average monthly payroll amounts and numbers of employees and were supported by false payroll records and bank records.
Weed used the federal money he received in five installments from three lenders to three businesses he controlled for his own use after transferring the money into four personal bank accounts, according to the indictment.
The grand jury handed up an indictment that included four counts of wire fraud.
Each of those charges is punishable by up to 20 years in prison.
The indictment also alleges that Weed filed a residential loan application for a Federal Housing Administration-backed mortgage in 2018, listing false employment and income information on his application.
Weed faces up to two years in prison if convicted on that charge.
The Paycheck Protection Program was a COVID-19 pandemic relief program administered by the Small Business Administration that provided forgivable loans to small businesses for job retention and certain other expenses, according to the U.S. Attorney’s Office.
That program permitted participating third-party lenders to approve and disburse SBA-backed loans to cover payroll, fixed debts, utilities, rent/mortgage, accounts payable and other bills incurred by qualifying businesses during, and resulting from, the COVID-19 pandemic, according to a written statement released Tuesday by Assistant U.S. Attorney Sean M. Green.
Copy the Story LinkComments are not available on this story.
Send questions/comments to the editors.
