Levant man pleads guilty to pandemic business loan fraud
Craig Franck, 40, pleaded guilty to wire fraud and money laundering charges in federal court on Tuesday.
BANGOR, Maine — A Levant man pleaded guilty to wire fraud and money laundering charges in U.S. District Court in Bangor on Tuesday to receiving more than $300,000 in fraudulent pandemic relief loans.
Court documents have revealed that Craig Franck, 40, faces three counts of wire fraud and one count of money laundering. He is accused of falsely stating in pandemic relief applications that he owned CCF Acoustics, LLC and CCF Acoustical Systems. Franck previously owned both companies, but neither was in operation in 2020 or 2021.
Franck submitted two fraudulent loan applications to the US Small Business Administration in the summer of 2020 for Economic Injury Loans (EIDLs). In the applications, he claimed the funds would be used to mitigate the economic harm caused by the pandemic. He received $177,400 in funds from these applications.
RELATED: Maine man faces up to 30 years in prison in PPP fraud case
In the applications, Franck also claimed that he was not facing any criminal charges when at that time he had been arrested for criminal fraud in Florida. He then illegally used the funds he received from EIDL loans to hire a criminal defense lawyer and post bail in the case.
Franck also used some of the funds he received to buy a new van and other personal expenses.
In March 2021, he received additional funds from the Paycheck Protection Plan (PPP) after he submitted a fraudulent loan application to a private lender, submitted false IRS forms and checked account statements. Franck used the $145,060 he received from this PPP loan to purchase another van and additional personal items.
Andrew Lizotte, Assistant U.S. Attorney, is the prosecutor in this case.
“This, and other similar cases, are very important cases,” Lizotte said. “They stem from the pandemic, they are extremely cynical and opportunistic. And what we want people to know is that we continue to investigate these and anyone who violated federal law to obtain funds in the event pandemic, we keep looking at this.”
Lizotte adds that Congress recently extended the statute of limitations for such cases of misuse of federal funds from six years to 10 years. He says that gives federal investigators more time to look into pandemic fraud.
Franck faces up to 20 years in federal prison, a $250,000 fine and three years of probation.
Lizotte says Franck’s sentencing should take place in a few months. A pre-sentence inquest report must first be filed before the judge, Lance Walker, makes his final decision.
Franck is now the second Maine man to be charged for taking advantage of pandemic relief fund programs. Nathan Reardon, of Skowhegan, faces up to 30 years in federal prison after pleading guilty to taking PPP money he was not eligible for.
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