Man pleads guilty to lying to get loans

Marina owner accused of false statements following Hurricane Sandy disaster

An Old Saybrook marina owner pleaded guilty Monday to lying about damage his property sustained during Hurricane Sandy to obtain more than $1.6 million in disaster relief loans from the Small Business Administration.

Scott Sundholm 39, waived his right to be indicted and pleaded guilty Monday to one count of making false statements to obtain the loans before U.S. District Judge Michael Shea in Hartford federal court.

Sundholm owns and operates S&S Marine in Old Saybrook and applied for a disaster loan from the Small Business Administration in 2016 for damage he claimed the property sustained during Hurricane Sandy in 2012, U.S. Attorney John Durham said.

The tidal surge during the storm at the marina allegedly damaged floating boat docks, a boat ramp, a metal shop building and a bath house, Sundholm claimed at the time. He also claimed he rebuilt the bath house “the same size and quality” after the storm.

In reality, though, the marina had no floating boat docks or ramps before the storm and Sundholm had demolished the previous bath house in September 2012 — more a month before Hurricane Sandy, Durham said.

Hurricane Sandy devastated the Northeast when it made landfall at the end of October 2012 and is considered the second costliest storm in U.S. history after it caused an estimated $75 billion in physical damage and business losses, federal officials concluded.

Federal lawmakers later allocated hundreds of millions of dollars to the Small Business Administration to offer disaster relief assistance and small business loans to home and business owners in the wake of the storm and the administration totaled nearly $114 million in verified losses through the program in Connecticut, according to government data.

Long delays and rejections plagued the SBA’s first round of assistance processing in the immediate aftermath of the storm, however, so lawmakers reopened the program for Sandy victims in late 2015 and into 2016, when Sundholm made his application for a business loan.

Sundholm has since paid full restitution of more than $1.65 million to the Small Business Administration, Durham said.

Sundholm is scheduled to be sentenced Sept. 6 and faces a maximum term of two years in prison and a fine. He has been released until the sentencing, Durham said.