Florida Man Accused Of Using COVID Relief Funds To Buy A Lambo Faces Fraud Charges
A Florida man was accused by Federal prosecutors of defrauding the COVID relief funds of nearly $4 million from the paycheck protection program. Prosecutors say that the man then used that money to purchase a Lamborghini sports car.
According to reports published by the Justice Department:
David T. Hines, 29, of Miami, Florida, was charged by criminal complaint, unsealed today upon his initial appearance before U.S. Chief Magistrate Judge John J. O’Sullivan in the Southern District of Florida, with one count of bank fraud, one count of making false statements to a financial institution and one count of engaging in transactions in unlawful proceeds.
The complaint alleges that Hines sought approximately $13.5 million in PPP loans through applications to an insured financial institution on behalf of different companies. The complaint alleges that Hines caused to be submitted fraudulent loan applications that made numerous false and misleading statements about the companies’ respective payroll expenses. The financial institution approved and funded approximately $3.9 million in loans.
The complaint further alleges that within days of receiving the PPP funds, Hines purchased a 2020 Lamborghini Huracan sports car for approximately $318,000, which he registered jointly in his name and the name of one of his companies. In the days and weeks following the disbursement of PPP funds, the complaint alleges that Hines did not make payroll payments that he claimed on his loan applications. He did, however, make purchases at luxury retailers and resorts in Miami Beach.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act is a federal law enacted March 29. It is designed to provide emergency financial assistance to millions of Americans who are suffering the economic effects resulting from the COVID-19 pandemic. One source of relief provided by the CARES Act is the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses through the PPP. In April 2020, Congress authorized over $300 billion in additional PPP funding.
"Those purported employees either did not exist or earned a fraction of what Hines claimed in his PPP applications," according to the charging documents. "Collectively, Hines falsely claimed his companies paid millions of dollars in payroll the first quarter of 2020. State and bank records, however, show little to no payroll expense during this period."
This is not the first case we've reported on where employers allegedly falsified employee documents to capitalize on COVID relief funds. Fund meant to help keep small businesses going during these uncertain times.