Man Bought Lamborghini After Receiving $ 3.9 Million PPP Loan | USAO-SDFL
Miami, Florida – A Florida man has pleaded guilty to fraudulently obtaining approximately $ 3.9 million in Paycheck Protection Program (P3) loans and using those funds, in part, to purchase a sports car Lamborghini of $ 318,000 for itself.
Authorities seized the Lamborghini and $ 3.4 million in the bank accounts of David T. Hines, 29, of Miami, at the time of his arrest. Hines has pleaded guilty to one count of wire fraud and is expected to be sentenced on April 14.
As part of his guilty plea, Hines admitted that he fraudulently solicited millions of dollars in PPP loans by submitting claims to a financial institution insured on behalf of different companies. Hines had fraudulent loan applications submitted which made numerous false and misleading statements about the companies’ respective salary expenses. The financial institution approved and funded approximately $ 3.9 million in PPP loans.
Hines further admitted that within days of receiving the PPP funds, he used the funds to purchase a 2020 Lamborghini Huracan sports car for around $ 318,000. Advocacy documents indicate that in the days and weeks after the PPP funds were disbursed, Hines failed to make the payroll payments he claimed on his loan applications. However, he used the proceeds of the PPP for personal expenses.
U.S. Attorney Ariana Fajardo Orshan of the Southern District of Florida, Acting Deputy Attorney General Nicholas L. McQuaid of the Criminal Division of the Department of Justice, Special Agent in Charge Kyle A. Myles of the Federal Deposit Insurance Corporation ( FDIC) Office of the 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 BIG of the US Small Business Administration (SBA), Investigations Division, Eastern Region Bureau, Special Agent in Charge Michael J. De Palma of the Miami Bureau of Criminal Investigations (CI) of the IRS and Special Agent Acting in charge Stephen Donnelly of the Board of Governors of the Federal Reserve System and the Bureau of Consumer Financial Protection OIG, Eastern Region, made the announcement.
The CARES (Coronavirus Aid, Relief, and Economic Security) law is a federal law enacted on March 29, 2020. It is designed to provide emergency financial assistance to millions of Americans who are suffering the economic effects resulting from the pandemic of COVID-19. One source of relief under the CARES Act is the authorization of up to $ 349 billion in forgivable loans to small businesses for job retention and certain other expenses under the PPP. In April 2020, Congress authorized more than $ 300 billion in additional P3 funding.
The PPP allows small businesses and other eligible organizations to benefit from loans with a two-year term and an interest rate of 1%. Businesses must use the proceeds of the PPP loan for salary costs, mortgage interest, rent, and utilities. The PPP allows the remission of interest and principal if the companies spend the proceeds of these expenses within a specified time frame and use at least a certain percentage of the loan for wage costs.
This matter was investigated by the FDIC-OIG, USPIS, IRS-CI, SBA-OIG and the Board of Governors of the Federal Reserve System and the Bureau of Consumer Financial Protection OIG. Assistant U.S. Attorney Michael Berger of the Southern District of Florida and Trial Lawyer Emily Scruggs of the Fraud Section of the Criminal Division and are pursuing the case.
The Fraud Section leads the Department’s prosecutions of fraud schemes that exploit the PPP. In the months following the passage of the CARES Act, Fraud Section lawyers prosecuted more than 100 defendants in more than 70 criminal cases. The Fraud Section also seized over $ 60 million in cash proceeds from fraudulently obtained PPP funds, as well as numerous real estate and luxury items purchased with these products. For more information, visit: https://www.justice.gov/criminal-fraud/ppp-fraud.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Control hotline at 866-720- 5721 or via the NCDF web complaint form at: https: //www.justice. gov / disaster-fraud / ncdf-disaster complaint form.