Norway Man Sentenced to 2 Years for Obtaining over $240,000 From PPP Loan Fraud

A Norway man who was accused of filing numerous fraudulent applications to gain over $240,000 from a pandemic-era relief program has been sentenced to two years in prison, the U.S. Attorney’s Office for the District of Maine announced Friday.

Merton Weed Jr., 52, was sentenced by U.S. District Judge Nancy Torresen on Friday to 24 months imprisonment, to be followed by three years of supervised release.

Weed was also ordered to pay $253,646 in restitution.

[RELATED: Norway Man Charged with PPP Loan, FHA Mortgage Fraud Faces Up to 20 Years in Prison After Plea Deal…]

According to court records, Weed filed eight fraudulent applications to the COVID-19-era Paycheck Protection Program (PPP), obtaining $243,745 in taxpayer-funded relief payments.

Prosecutors alleged Weed listed false payroll and employee information for phony businesses that did not exist on the applications, and falsified bank records to support his applications.

“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 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 said. “The Department of Justice and my office will continue to bring to justice those who, like Mr. Weed, sought to capitalize on an unprecedented crisis to line their own pockets.”

When initially indicted in February 2023, Weed was charged with four counts of wire fraud and one count of filing a fraudulent application for a Federal Housing Administration (FHA) insured mortgage.

Weed was accused of listing false employment and income information on the FHA loan, a federal crime punishable by up to a $5,00 fine and a maximum prison sentence of two years.

As part of an October 2023 plea deal, Weed pleaded guilty to the four counts of wire fraud, while the FHA fraud count was dropped.

Weed’s plea deal with federal prosecutors came at a time when Maine Senate President Troy Jackson (D) was facing scrutiny for obtaining a similar FHA insured loan to purchase a second home in Augusta in September 2019.

[RELATED: Maine Senate President Troy Jackson Locked in Bitter Legal Fight Over Augusta Home He Bought – and Moved Into – in 2019…]

As part of the FHA loan application, President Jackson and his partner signed a mortgage document stating that they would make the Augusta property their “principal residence” for at least one year.

But when submitting documents to the Maine Ethics Commission in 2020 while running for reelection in Senate District 1, he listed his primary residence as Allagash.

Jackson stated that he “never really read” the mortgage document that he signed when purchasing the Augusta property, and told the Ethics Commission in a September 2023 letter that the home was a “temporary place to stay during the week.”

[RELATED: The Mortgage Broker Troy Jackson Threw Under the Bus Denies Wrongdoing: “Something seems a little fishy here”…]

In October 2023, the Maine Ethics Commission released a 110-page memo recommending against any further investigation into whether Jackson submitted false information to the Commission and violated the residency requirement when running for reelection in 2020.

“If the statements in Sen. Jackson’s preliminary response are correct, he has a convincing case to make that he remained a resident of Senate District 1, even if he occupied the Augusta property during the majority of September 2019 – September 2020,” Executive Director Jonathan Wayne wrote in the memo.

The issues of Jackson’s apparent misstatements on the mortgage document, allegations of insurance fraud, and his exorbitant use of travel reimbursement funds, all fall outside of the Ethics Commission’s jurisdiction, which is limited to investigating the conduct of legislators in their official duties.

Maine State Rep. John Andrews (R-Paris), author of the original ethics complaint against Jackson, told the Maine Wire following the release of the Commission’s memo that their determination essentially found that Jackson’s “primary residence was in Allagash and not Augusta when he signed an FHA loan form stating that Augusta was his primary residence.”

“That’s a federal crime, and U.S. Attorney Darcie McElwee needs to investigate this to make sure that the rule of law still applies in Maine,” Rep. Andrews said.

The FBI describes occupancy fraud, a type of mortgage application fraud, as occurring “when the borrower states on the application that they intend to live in the home they are buying when it’s actually an investment property.”

Mortgage records indicate that Jackson sold his Augusta home in 2021, for more than $100,000 what he paid for it.