Hackstadt pleaded guilty in May to two counts of wire fraud. It had fallen victim to the Paycheck Protection Program, loans issued by private financial institutions and supported by the US government, and economic disaster loans issued by the US Small Business Administration.

On Tuesday, Hackstadt and his attorney, Jonathan Cohn, petitioned Suddaby for clemency. They told the judge that Hackstadt experienced a traumatic and abuse-filled childhood, thyroid and kidney cancer, and the April 2019 death of her husband of nearly 47 years.

“I’m terribly sorry. I was trying to help my family,” Hackstadt told Suddaby amid tears, as half a dozen family members and well-wishers watched from a bench in the hall. hearing. “I just freaked out. I really wasn’t thinking when I asked for the loans.”

Cohn asked the judge to consider a sentence without jail. The attorney said his client had repaid more than $154,000 of the money owed (an amount the judge later called “tiny”).

“She’s 68. She’s not a criminal mastermind,” the attorney said.

The judge told Hackstadt that many people experience difficulties in life.

“The difference is they’re not cheating and lying at 68. There’s no justification for that behavior,” Suddaby said.

Due to Hackstadt’s age, lack of criminal history, and acceptance of responsibility, Suddaby fell below sentencing guidelines which called for a sentence of between 33 and 41 months. He told Hackstadt that she defrauded lenders and the government for her own benefit.

“This is the most outrageous conduct I have ever seen. There is simply no excuse or explanation,” he said, adding that Hackstadt’s past “does not justify this behavior in any way.” .

The judge allows Hackstadt to report to jail the first week of January.

“You represent a very unusual case,” the judge told the defendant, adding that it was “not something I usually do.”

In total, the Hackstadt scheme led to the agencies issuing 27 PPP and EIDL loans totaling $1,615,546, according to federal prosecutors in Albany.

“Defendant defrauded loan programs that provided urgent financial lifelines to legitimate business owners and their employees, amid a crippling pandemic,” Assistant U.S. Attorneys Joshua Rosenthal and Michael Barnett said in a statement. a pre-sentencing recommendation to Suddady, “While countless people have suffered the economic effects of the pandemic, the defendant viewed the PPP and the EIDL program as opportunities to engage in a vast illegal scheme.”

Prosecutors said the loans went to Hackstadt, her family members and acquaintances, and businesses she or her family members controlled. They said Hackstadt lied to the Small Business Administration and PPP lenders by making it up or grossly exaggerating the number of employees and payroll for which it obtained loans.

Additionally, prosecutors said Hackstadt admitted to defrauding two financial lenders in agreements to purchase alleged debt from a defunct company. In 2019, she fraudulently raised $42,290 by falsely claiming to a lender that one of her businesses made $180,000 in gross annual sales.

“But, as the defendant knew when she made these false statements, the company had no operations or income,” prosecutors told Suddaby.

And in 2021, prosecutors said that at the same time Hackstadt applied for pandemic relief funds, she fraudulently received $48,500 from a second lender whom she provided with fake bank statements and tax documents. falsely showing that a company controlled by Hackstadt had significant business income. when he had none. Hackstadt quickly defaulted on both loans, causing the lenders to lose a total of $80,778.

Prosecutors said that prior to 2019, Hackstadt had been subject to five bankruptcy filings in 16 years in addition to civil judgments.

“This prelude to the defendant’s large-scale fraud during the pandemic demonstrates that the rush for pandemic aid only amplified the defendant’s existing desire to commit crimes,” prosecutors told the court. judge. “The court’s sentencing should send a strong message not only to this defendant but to all potential scammers that this type of misconduct will carry serious consequences.”

US attorney Carla Freedman called the crime a “prolific fraud”, adding: “She took advantage of an economically devastating pandemic and stole money that was meant for legitimate businesses struggling to stay afloat.” Janeen DiGuiseppi, the special agent in charge of the FBI’s Albany field office, said in a statement that Hackstadt “took over $1 million from deserving businesses that were in desperate need of support.”