The first Mainer accused of fraudulently obtaining a loan from the Paycheck Protection Program, intended to help businesses pay employees and other expenses during the early days of the pandemic, denied the charges Tuesday in U.S. District Court in Bangor.
Nathan Reardon, 43, of Skowhegan and formerly of Brewer pleaded not guilty to five counts of bank fraud, three counts of attempted wire fraud, two counts of making false statements to a bank and one count of perjury. Reardon was indicted earlier this month by a federal grand jury.
He obtained a $60,000 PPP loan in 2020.
The perjury charge stemmed from his first court appearance last month, not from the loan process. Reardon allegedly lied about his income on the financial form used in determining whether a defendant qualifies for a court-appointed attorney. He listed his income as zero on the form but listed a monthly income when he filed for bankruptcy, according to the indictment.
A trial is not expected to be held before next year.
Reardon remains free on $5,000 unsecured bail. He would not have to post cash as bail unless he violates conditions of his release. Conditions of his release include not applying for pandemic-related assistance without the approval of U.S. Probation and Pretrial Services.
He was charged last month and made his first court appearance on April 15, the same day he filed for bankruptcy in an effort to reorganize his debt. Reardon previously filed for bankruptcy in 2014 and 2018 in Florida.
In his 129-page Maine bankruptcy filing, Reardon listed his assets, made up solely of personal property, at nearly $18,000 and his liabilities at $385,000. His monthly household income is $2,500, $500 of which is rental income and the rest a gift from family, according to the filing.
His filing lists nearly 200 creditors, many of whom are former employees owed back wages. He owes $36,000 in federal and state back taxes and more than $55,000 in back rent for business properties in Bangor and Brewer. He also owes thousands of dollars to plumbers, electricians, security firms, construction companies, utilities, cable firms, cell phone providers and individuals who gave him personal loans.
The bankruptcy filing also said that he owes the government $90,000 for the PPP loan — $60,000 for the loan and $30,000 for money he received mistakenly and spent.
Reardon has said that he is opening a Taco Shack at 95 Center St. in Bangor similar to the restaurant he operates in Newburgh. It could not be determined if any of Reardon’s debts are related to the planned opening of that business.
Reardon applied for the loan for his business, Global Disruptive Technologies Inc., on April 3, 2020, one week after Congress passed the CARES Act that provided money for PPP loans through private lending institutions, the affidavit said. Reardon sought the loan through TD Bank in Bangor where he had a checking account.
In applying for the loan, Reardon allegedly lied about the business’ monthly payroll and expenses. When the loan was approved and the money was transferred to his account on April 22, 2020, it had a negative balance of more than $4,000, the complaint said.
Eight days later Reardon allegedly illegally applied for a second PPP loan using the same false information. The bank denied that application but mistakenly released another $59,145 to Reardon’s account on May 4, 2020, the affidavit said. Two days later, TD Bank identified the error and placed a freeze on the remaining $28,000 in the account.
Reardon’s purchases with the illegally obtained loan included 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, a court affidavit said. Caimans are a species related to alligators found in Central and South America.
He listed some of those items as assets in his bankruptcy filing.
Reardon also allegedly used the money to pay a lawyer and a local veterinarian, make donations to a Florida church and shop online. In addition, he withdrew more than $10,000 of the loan in cash, the complaint said.
If convicted, Reardon faces up to 30 years in prison and a fine of up to $1 million. He also could be ordered to repay the amount of the loans, including the money he received mistakenly.