A dual New York/Florida resident was sentenced in New Jersey to a plea-bargained 51 months in federal prison for fraudulently collecting more than $6.8 million in COVID-19 payroll protection loans — $3 million of which he lost in the stock market.
Gregory J. Blotnick, 35, will have to serve just about all of the sentence because there’s no parole in the federal prison system.
In addition to the prison term, U.S. District Judge Brian R. Martinotti sentenced Blotnick in Newark to two years of supervised release and ordered him to pay restitution of $4,577,631.
Blotnick told the judge last fall that he applied to 13 lenders for 21 loans by lying about the number of employees at nine companies whom he supposedly needed to pay.
He dumped the money into a personal brokerage account instead, then poured nearly 45% of it into losing stock trades, U.S. Attorney for New Jersey Philip R. Sellinger said.
The government ended up charging him with 33 counts of grand larceny and fraud. Blotnick took a deal from the government rather than risk a trial, pleading guilty last October to single counts of wire fraud and money laundering.
Blotnick is among dozens of people charged by the government with trying to steal from the taxpayer-funded Paycheck Protection Program (PPP), which was designed to keep struggling small businesses afloat during the pandemic.
The program distributed an estimated $525 billion in forgivable loans to more than five million companies,…
