A federal judge will decide Wednesday how long a Maine man convicted of defrauding a federal COVID-19 relief program will spend behind bars, but that decision may not hinge on how much money he actually stole.
Rather, federal prosecutors are asking U.S. District Judge Lance Walker to consider the full amount Nathan Reardon intended to steal.
Reardon, 44, of Skowhegan and Plymouth pleaded guilty in July to five counts of bank fraud in U.S. District Court in Bangor for obtaining a $60,000 Paycheck Protection Program loan in 2020 by falsifying information about payroll for his business.
Prosecutors with the U.S. attorney’s office in Maine are seeking a sentence of 18 to 24 months behind bars. They’re basing that on the amount of money Reardon sought to steal — $236,580 — even if he never obtained the full sum.
Reardon “purposely sought to inflict significant pecuniary harm with his submission of four Paycheck Protection Program (‘PPP’) loan applications to TD Bank,” Assistant U.S. Attorney Andrew Lizotte said in the federal government’s sentencing memo.
“In short, Defendant is a teller of tall tales,” Lizotte said. “His conduct presented just a single realistic outcome — that of default and the losses certain to follow any loans he fraudulently received.”
The loans were intended in the early days of the pandemic to allow businesses to pay employees affected by the widespread shutdowns to curb the spread of the coronavirus. Reardon applied for four loans for two of his businesses, each totaling $59,145, but only succeeded in securing one loan.
He used the fraudulently obtained money on personal items, such as a men’s 14-carat yellow gold wedding band, clothing, shaving products, toys, an LED barber pole light and a pair of caiman skin cowboy boots, according to court documents. Caimans are a species related to alligators found in Central and South America.
Reardon’s attorney, Hunter Tzovarras, argues that his client’s sentence should be based on the $59,145 his client actually stole. Tzovarras also advocated for a jail sentence of zero to six months, which a judge could conclude Reardon has already served, as he has been behind bars since April, when he was arrested on a bail violation.
Reardon has a constellation of dozens of companies in his name that have left in their wake unpaid wages, unpaid taxes, $100,000 in fines for labor violations and code violations that led Bangor officials to condemn a major section of a local mall.
His sentencing on Wednesday will mark the conclusion of a yearslong effort by federal investigators to hold him accountable for stealing thousands of dollars.
The U.S. attorney’s office has so far charged just three Mainers, including Reardon, with defrauding two different types of pandemic business loan programs. The cases involve more than $400,000.
Reardon has been joined in Maine by Craig Franck and John J. Cavanaugh Jr., who have pleaded guilty to defrauding the federal relief programs. The trio are among more than 1,200 people nationwide charged with defrauding COVID-19 relief programs.
Those programs, developed in the early months of the pandemic, proved especially susceptible to fraud, with the U.S. Secret Service estimating late last year that there had been nearly $100 billion in potentially fraudulent pandemic relief activity.
While Maine’s cases have included relatively small amounts of money stolen from the federal government, the shockwaves from Reardon’s case have reverberated across Penobscot County and beyond.
Just before Reardon was arrested for violating his conditions of release ahead of his bank fraud trial in April, he filed lawsuits against at least two of his former employees and tenants accusing them of defamation. That same week, he filed a lawsuit against the Bangor Daily News for its coverage of his business activities. Judges have since dismissed all three cases.
Reardon had addresses across the state where he claims to have operated legitimate businesses. In Bangor, Reardon occupied a portion of the now-defunct Sears in the Bangor Mall as well as an office downtown. He was formally evicted from those spaces in May and June, according to court records.
Reardon continued to operate inside the Sears space even after Bangor condemned the property in January. That section of the struggling mall remains condemned by the city, according to Bangor Code Enforcement Director Jeff Wallace.
