ROCKLAND — The state is asking the former owner of the defunct Castle Builders contractor company in Union be sentenced to five years in prison if convicted of stealing nearly $500,000 from customers.

The Maine Attorney General’s Office filed April 6 a memo to the court on what it would seek in the case of Malcolm Stewart if the defendant is convicted.

The memo was used in a dispositional conference. A dispositional conference is when a judge meets with the prosecution and defense behind closed doors and tries to negotiate a settlement. No agreement has been reached in the Stewart case.

Stewart pleaded not guilty in May 2021. He was indicted in March 2021 by a Knox County grand jury for two counts of theft by deception. He remains free on bail.

Stewart now resides in Pelzer, S.C. He signed a Maine Pre-Trial Contract and must have no contact with the scores of alleged victims. He also had to turn in his passport. Stewart is a Canadian citizen and has a green card.

The recommendation by the Attorney General’s Office calls for eight years in prison with all but five years suspended to be followed by three years of probation.

Defense attorney David Bobrow of Eliot said Wednesday, May 4, recommendations made during a dispositional conference are suppose to be confidential. He declined to say what the position of the defense is.

Fifty-six victims of the alleged scheme were listed in the indictment with the amount of thefts totaling $437,906. One couple was taken for $192,750, according to the state. The couple, from Damariscotta, contracted with Stewart to build a garage and workshop.

The offenses are alleged to have occurred from April 2018 until September 2019 in Knox, Waldo, Hancock, Kennebec, Lincoln and Somerset counties.

The memo from the AG’s Office states Stewart’s wife Elizabeth Stewart worked primarily as the office manager and bookkeeper for the company. Their son, Cody Stewart, has cooperated with the investigation, according to the AG’s memo. Malcolm Stewart was the only person charged criminally in the case.

The memo states, “Between May 2017 and September 2019, Stewart entered into scores of contracts with dozens of customers throughout central and Midcoast Maine, taking deposits and installment payments for a range of construction projects. In many instances, no work was ever started for the customer. In other instances, Stewart’s laborers completed just enough subpar work to secure further payments.”

“As Castle’s financial picture deteriorated in 2019, Stewart increased the scale and frequency of his fraudulent conduct until Sept. 9, 2019, when he abruptly closed Castle Builders and fled the state with his wife,” the AG’s Office stated.

The Maine Attorney General’s Office filed a civil lawsuit against Stewart and his wife and Castle Builders, accusing them of bilking more than 100 people out of more than $1 million. That case remains pending in the court system.

The AG began the investigation after numerous complaints were filed by customers, some before the couple closed their contracting business in September 2019.

A case in U.S. Bankruptcy Court concluded in March with only $5,000 in claims being paid while nearly $40,000 in administrative fees were paid. The initial claims filed in the bankruptcy case totaled more than $1.1 million including taxes and payroll. There were 177 creditors listed in their bankruptcy filing with most of them former customers of Castle Builders. Former workers, suppliers and the government are also listed as creditors.