Hampton man sentenced for COVID-19 loan fraud while in halfway house

Prison bars
Posted at 4:43 PM, Jul 09, 2022
and last updated 2022-07-09 16:43:49-04

NEWPORT NEWS, Va. – A Hampton man was sentenced Thursday for falsely applying for loans intended to grant COVID-19 relief to small businesses.

According to court documents, in August 2020 and January and February 2021, 44-year-old Marlon McKnight, falsely applied for four loans administered by the Small Business Administration. He was sentenced to 27 months in prison.

They say he applied for three Economic Injury Disaster Loans and one Paycheck Protection Program loan using false information, including false business names, income, and employee information, as well as a false tax return.

McKnight sought over $100,000 in loans and obtained approximately $35,000. According to the courts, McKnight used the $35,000 obtained to pay his personal expenses, contrary to the purposes of these loans. He submitted certain false applications from a halfway house and others after just being released from the Bureau of Prisons.

Documents say McKnight had been incarcerated because this instance of fraud came directly on the heels of a previous federal fraud scheme wherein McKnight, his wife, and several others victimized banks and stole individual identities. He had been sentenced to 30 months for that scheme and ordered to pay nearly $100,000 in restitution.

In addition to the 27-month sentence, McKnight was sentenced to an additional four months for violating his parole.