Norway man arrested on charges of pandemic-related loan fraud
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Merton Weed Jr. is accused of listing false payroll information and number of employees to get funds through the Paycheck Protection Program.
A Norway man could face up to 20 years in prison, a $250,000 fine and three years of supervised release following his arrest on Tuesday for allegedly defrauding the Paycheck Protection Program.
Merton Weed Jr., 50, was charged with loan fraud for allegedly submitting a false application for a Federal Housing Administration-insured mortgage and filing five applications for PPP loans requesting over $150,000 between May 2020 and January 2021, according to a Tuesday release by the U.S. District Court in Portland.
Weed is accused of listing fraudulent average monthly payrolls and numbers of employees, supported by false payroll records and bank records. The indictment also alleges that Weed filed a residential loan application for an FHA-insured mortgage in 2018, listing false employment and income information on the application. No court date was listed.
The release did not note the name of the business(es) Weed owned, if any. The FBI is still investigating the case, according to the release.
This is the second case of PPP fraud prosecuted in Maine this month. Mark X. Haley II, 42, of Rockport, faces up to 30 years in prison and a $1 million fine after pleading guilty Feb. 9 in U.S. District Court in Portland. According to an investigation by the IRS, Haley filed nine fraudulent Paycheck Protection Program loan applications at two banks for businesses he controlled.
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 other expenses. The PPP allowed third-party lenders to disburse the loans to cover payroll, some debts, utilities, rent/mortgage, accounts payable and other expenses incurred by qualifying businesses resulting from the pandemic. PPP loans were fully guaranteed by the SBA.
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