A Florida man is facing charges after authorities say he fraudulently received $4 million in federal loans meant for small businesses impacted by covid-19 pandemic and used it to buy a Lamborghini, spent the remaining on dating website, luxury stores, and Miami resorts.
David T. Hines, 29, of Miami, was charged with bank fraud, making a false statement to a lending institution and engaging in transactions in unlawful proceeds, according to prosecutors in the U.S. District Court for the Southern District of Florida. If convicted on all charges, he could face up to 70 years in prison, The New York Times reported.
Trouble started for Hines after he was involved in a hit-and-run accident involving his Lamborghini on July 11 and authorities started investigation.
The Lamborghini was linked back to him and impounded by Miami police, according to the Miami Herald.
In April this year, Hines from Miami Florida joined thousands of small business owners impacted by the coronavirus pandemic to seek financial help from the federal Paycheck Protection Program (PPP), a loan program created to help small businesses that are struggling due to the pandemic
Authorities said Hines requested about $13.5 million in PPP loans and that he submitted seven loan applications in May, which contained “numerous false and misleading statements” about his alleged moving companies’ respective payroll expenses.
Hines stated on his loan application that he operated four businesses with 70 employees and had $4 million in monthly expenses.
“Those purported employees either did not exist or earned a fraction of what Hines claimed in his PPP applications,” Huffpost reported, quoting Masmela, who also said that authorities were unable to find any record of operating websites linked to Hines’ businesses.
Authorities said that $3,984,557 of Hines loan request were approved. As that money came in, he continued submitting requests for more funds. Eventually, his requests totaled $13,542,741, officials said.
Hines allegedly spent about $318,000 to purchase a 2020 Lamborghini Huracan sports car. He also spent thousands of dollars in payments to dating websites, jewelry stores and luxury clothing retailers, as well as to Miami Beach resorts. Two payments totaling $30,000 were also documented as going to “mom,” according to the criminal complaint.
“Businesses must use PPP loan proceeds for payroll costs, interest on mortgages, rent and utilities,” the Department of Justice said in a release announcing Hines’ charges. “The PPP allows the interest and principal to be forgiven if businesses spend the proceeds on these expenses within a set time period and use at least a certain percentage of the loan towards payroll expenses.”
The bank accounts listed as belonging to Hines’ moving companies were reportedly closed and $3.4 million was seized from the accounts as soon as he was arrested.
In a statement to The Washington Post, Hines’ attorney defended him as a “legitimate business owner who, like millions of Americans, suffered financially during the pandemic.”
“While the allegations appear very serious, especially in light of the pandemic, David is anxious to tell his side of the story when the time comes,” said attorney Chad Piotrowski.