Norway man sentenced to 2 years in prison for PPP loan fraud
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Merton Weed Jr., of Norway, was sentenced to two years imprisonment followed by three years of supervised release for PPP loan fraud.
A Norway man has been sentenced to two years in prison and ordered to pay $253,646 in restitution for filing fraudulent applications for loans from the federally funded Paycheck Protection Program.
Merton Weed Jr., 52, pleaded guilty in October and was sentenced May 31 by U.S. District Judge Nancy Torresen in Portland. The prison term is to be followed by three years of supervised release.
Court records show that between May 2020 and January 2021, Weed filed eight fraudulent PPP loan applications with four different lenders and received $243,745 in PPP funds, according to a press release issued by the U.S. District Attorney's Office for the District of Maine.
In his applications, Weed listed false average monthly payrolls and employee numbers for businesses that did not exist, and submitted falsified bank records as supporting documents.
'Motivated by greed'
The FBI investigated the case, and arrested Weed in February 2023.
“Motivated by greed, Merton Weed took advantage of a program intended to help small businesses survive economic uncertainty during the COVID-19 pandemic,” said U.S. Attorney Darcie N. McElwee. “Mr. Weed has a lengthy history of enriching himself through fraud, so it is perhaps not surprising that he made not one but eight attempts to take advantage of a time of international turmoil.”
McElwee also noted that the Justice Department and his office “will continue to bring to justice those who, like Mr. Weed, sought to capitalize on an unprecedented crisis to line their own pockets.”
The PPP was a pandemic relief program administered by the U.S. Small Business Administration that provided forgivable loans to small businesses for job retention and other eligible expenses.
Participating third-party lenders approved and disbursed SBA-backed PPP loans for qualifying businesses to cover payroll, fixed debts, utilities, rent/mortgage and other pandemic-related expenses.
In 2020 alone, more than 28,000 Maine businesses received $2.3 billion in loans from the program, helping support more than 250,000 jobs.
However, the PPP drew criticism early on for being prone to fraud, waste and abuse.
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