Florida man who used COVID relief funds to buy Lamborghini sports car accused by Miami Federal Court
A Florida man has been arrested and charged with fraudulently obtaining $ 3.9 million in Paycheck Protection Program (P3) loans and using those funds, in part, to purchase a sports car for himself. Authorities seized a sports car for $ 318,000 and $ 3.4 million from bank accounts at the time of the arrest.
Acting Assistant Attorney General Brian C. Rabbitt of the Department of Justice’s Criminal Division, U.S. Attorney Ariana Fajardo Orshan of the Southern District of Florida, Special Agent in Charge Kyle A. Myles of the Federal Deposit Insurance Corporation ( FDIC) Office of Inspector General (OIG), Atlanta Regional Office of the Office of Investigation, Inspector in Charge Antonio Gomez of the Miami Division of the US Postal Inspection Service (USPIS), Special Agent in Charge Kevin A. Kupperbusch of the US Small Business Administration (SBA) -OIG, Investigations Division, East Regional Office, Special Agent in Charge Michael J. De Palma of Miami IRS-Criminal Investigation (CI) Office and Acting Special Agent in Charge Stephen Donnelly from the Board of Governors of the Federal Reserve and the Bureau of Consumer Financial Protection- The OIG, Eastern Region, made the announcement.
David T. Hines, 29, of Miami, Florida, was indicted by an unsealed criminal complaint today during his initial appearance before U.S. Chief Justice John J. O’Sullivan in the Southern District of Florida , with one count of bank fraud, one count of misrepresentation to a financial institution and one count of transactions involving illegal products.
The complaint alleges that Hines requested approximately $ 13.5 million in PPP loans through applications from a financial institution insured on behalf of different companies. The complaint alleges that Hines had fraudulent loan applications submitted that made numerous false and misleading statements about the companies’ respective salary 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 jointly registered in his own name and in the name of one of his companies. . In the days and weeks after the PPP funds were disbursed, the complaint alleges that Hines failed to make the salary payments he claimed on his loan applications. He did, however, shop at luxury retailers and resorts in Miami Beach.
The CARES (Coronavirus Aid, Relief, and Economic Security) law is a federal law enacted on 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 under the CARES Act is the authorization of up to $ 349 billion in forgivable loans to small businesses for job maintenance and certain other expenses under the PPP. In April 2020, Congress authorized more than an additional $ 300 billion in P3 funding.
The PPP allows small businesses and other eligible organizations to receive loans with a two-year term and an interest rate of 1%. Businesses must use the proceeds from PPP loans for staff costs, mortgage interest, rent, and utilities. The PPP allows the remission of interest and principal if companies spend the proceeds of these expenses within a specified time frame and use at least a certain percentage of the loan for payroll costs.
A criminal complaint is simply an allegation and all accused are presumed innocent until proven guilty beyond a reasonable doubt by a court.
This case has been reviewed by the FDIC-OIG, USPIS, IRS-CI, SBA-OIG, and the Federal Reserve Board of Governors and the Bureau of Consumer Financial Protection-OIG. Lawyer Emily Scruggs of the Fraud Section of the Criminal Division and U.S. Assistant Lawyer Michael Berger of the South Florida District are continuing the case.
Anyone with information about alleged attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or through the NCDF online complaint form at the address: https: //www.justice. gov / disaster-fraud / ncdf-disaster complaint form.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.