Criminal Complaint — U.S. v. Hines

Record facts

U.S. District Court, S.D. Fla. · No. 1:20-mj-03237-JB · Doc. 1 · 2020-07-24 · Docket on CourtListener

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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT O F FLORIDA
CASE NO. 1:20-M I-03237-BECERRA
UNITED STATES OF AM ERICA
Y.
DAVID TYLER HIN ES,
Defendant
l
CRIM W AL COVER SHEET
Did this m atter originate from a m atter pending in the Central Region of the United States
Attomey's Oxce prior to Augtst 9, 2013 (Mag. Judge Alicia Valle)? 
-  Yes y-. No
Did this m atter originate âom  a matter pending in the Northern Region of the United States
Attomey's Offce prior to August 8, 2014 (Mag. Judge Shaniek Maynard)? 
Yes X No
Did this m atter origim te âom a m atter pending in the Central Region of the United States
Attomey's Ox ce prior to October 3, 2019 (Mag. Judge Jared Skauss)? 
-  Yes &  No
Respectfully submitteda
ARIANA FAJARDO ORSHAN
UNITED STATES ATTORNEY
M  .
M ICHAEL N. BERGER
Assistant United States Attom ey
Southem  Diskict of Florida
Court ID No. A5501557
99 Northeast 41  Skeet, 41  Floor
M inm i, Florida 33132-2 1 1 1
Telephone: (305) 96 1-9445
E-m ail: m ichael.berzerz@ usdoi.eov
EM ILY SCRUGGS
Trial Attorney
Court ID No. A5502310
DepaM ent of Juséce
1400 New York Ave, NW
W ashington, DC 20530
Telephone: (202) 616-2488
Email: Elllilsr.sclraastdtsdoi.aov
Case 1:20-mj-03237-JB   Document 1   Entered on FLSD Docket 07/24/2020   Page 1 of 11

e'$.() 9 l (Itcv. 08/09) Crilninal Conlplailyt
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David Tyler Hines,
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case No. 1:20-MJ-03237-BECERRA
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CRIM INAL COM PLAINT BY TELEPHONE OR OTHER RELIABLE ELECTRONIC M EANS
1, the complainant in this case, state that the following is true to thc best of my k-nowlcdge and bclief.
(.)tl or about the datcts) o f 
May 9, 1
. 3, 
.$.-1. k., .2. .0. )0.. . . . .. . ... in the county of 
..Mj.pp'j.-M#j#--..-. ...-.-. .. in the
Spktthqrn 
District of 
Flpridq.. 
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,. ,. . ... , tl'le defendantts) violated:
Ck-Wc Scction
18 U.S.C. j 1014
1 8 U.S.C. j 1 344
18 U.S.C. j 1957
O-t/itnse Dcvs'c?'fh/&pz7
False Statement to Lending Institution
Bank Fraud
Engaging in Transactions in Unlawful Proceeds
This crim inal conlplaillt is based on these facts:
SEE AU ACHED AFFIDAVIT.
W- colltinued ol1 tlle attached sheet.
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Printed at:)/?it! f'zaff title
Attested to by tlle A pplicallt i11 accordallce lvitll the requircnlellts of Fed-lt.criln. 4. 1 by telephone.
Date: 
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Case 1:20-mj-03237-JB   Document 1   Entered on FLSD Docket 07/24/2020   Page 2 of 11

AFFIDAVIT IN SVPPORT OF A CRIM INAL COM PLAINT
1, Bl-yan M aslnela, being first duly sworn, state'.
AG ENT BACKG RO tJND .AND INTRODUCTIO N
1 am a United States Postal Inspector and have been employed by the United States
Postal lnspection Service since Feblamry 2003. As a U.S. Postal lnspector, your affiant is
responsible for the investigation of violations of United States law, incltlding violations of Title
1.
18 ofthe United States Code. l am cun'ently assigned to the mail fraud temn in the M iam i Division
and my dtdies include investigating cases related to lnail fraud, wire fraud, bank fraud, money
laundering, and related financial crilnes. l am authorized to obtain and execute tkderal arrest,
search, and seizure wan-ants.
2 .
HINES (CCHINES'') with violations of Title l8, United States Code, Sedions 1014 (False
This affidavit is m ade in support of a crim inal complaint charging D AVID TYLER
Statements to a Financial lnstitution), 1344 (Bank Fraud), and 1957 (Engaging in Transactions in
Unlawful Proceeds).
3. 
This affi
. davit is based on my personal ilw estigation and investigation by others,
including federal and local law enforcem ent om cials whom I know to be reliable and tnzstworthy.
The facts contained herein have been obtained by intenziewing witnesses and exam ining
docum ents obtained in the course of the ilw estigation as well as through other means.
at-fidavit does not include every fact lk1- zown to m e about this ilw estigation, but rather only those
facts suflicient to establish probable cause.
Case 1:20-mj-03237-JB   Document 1   Entered on FLSD Docket 07/24/2020   Page 3 of 11

OVERV IEW  O F TH E SCHEM E AND THE PAYCHECK PROTECTIO N PROG M M
Overviob' ofthe Jkyc/lcc/z Proteaion Program
4.
The Coronavirus Aid, Relief, and Economic Security (CLCARES'') Act is a federal
1aw enacted in or around M arch 2020 designed to provide em ergency l-inancial assistance to the
m illions of Am ericans who are suftkring the econom ic eftkcts caused by the COVID- 19 pandem ic.
One source of relief provided by the CARES Act was the authorization of up to $349 billion in
forgivable loans to slnall businesses for job retention and certain other expenses, through a
prograln refen-ed to as the Paycheck Protection Prograln (çTPP''). ln or around April 2020,
Conress atlthorized over $300 billion in additional PPP ftlnding.
5. 
In order to obtain a PPP loan, a qualifying business mtlst submit a PPP loan
application, wlzich is signed by an autholized representative of the business. R'he PPP loan
application requires the business (through its autlzorized representative)to acknowledge the
program l-ules and lnak.e certain am nnative certifications in order to be eligible to obtain the PPP
loan. In the PPP loan application, the small business (through its authorized representative) must
state, among other things, its: (a) average lnonthly payroll expenses', and (b) number ot-employees.
These t'igures are used to calculate the amount of money the slnall business is eligible to receive
under the PPP. ln addition, businesses applying for a PPP loan must provide doctlmentation to the
lending institution showing their payroll expenses; typically, businesses would supply docum ents
showing the amount of payroll taxes repol-ted to the IntenAal Revenue Selwice C:IRS'').
6. 
A PPP loan applieation nzust be processed by a participating lender. If a PPP loan
application is approved, tlze participating lender funds the PPP loan using its own m onies, which
are 1 00f?4) guarantced by Slnall l3usiness ytdlni llistration (&:Sl3.?:t''). Data ti-om the applicatitm,
ilzehldillg illfbnalation about the borroqver, the total anlolult of tlle loall, alld the listed lzunlber of
Case 1:20-mj-03237-JB   Document 1   Entered on FLSD Docket 07/24/2020   Page 4 of 11

employees, is transm itted by the lender to the SBA in the course of processing the loan. hz the
ordinary course of providing the loan guaranty, neither the SBA nor any other govenunent agency
checked IRS records to confinn that the applicant had paid the payroll taxes represented in the PPP
appli cations.
7.
PPP loan proceeds must be used by the business on cellain pennissible expenses
payroll costs, interest on mortgages, rent, and tltilities. The PPP allows the interest and principal
on the PPP loan to be entirely forgiven ifthe business spends the loan proceeds on these expense
items uzithin a desiglmted period of tilne after receiving the proceeds and uses a certain amount of
the PPP loan proceeds on payroll expenses.
Background OfHINES tu1# Overview of tlte Scheme
'lhe United States is investigating fraudtllent applications subm itted in the name of
companies operated by DAVID TYLER HINES, to a lender approved by the SBA. HINES sought
approxim ately $13.5 million in PPP funds, purportedly for the purpose of paying em ployees.
Those ptlrported employees either did not exist or eanzed a fraction of what HINES claim ed in his
PPP applications. Collectively, HINES falsely claim ed his colnpanies paid millions of dollars in
payroll in tlze ls1-st quarter of 2020. State and bank records, however, show litlle to no payroll
expense during this period.
9 .
'Fhe lender approved three applications and paid $3,984,557.00 in PPP loans.
Instead offunding payroll, HINES spent the PPP m oney on personal expenses at dating websites,
luxury jeweloz and clothing retailers, and Miami Beach resorts. HINES also spent PPP ftmds to
purchase a 2020 Latnborghini sportscar for $318,497.53 that he registered jointly in his name and
the nmne ofhis company.
Case 1:20-mj-03237-JB   Document 1   Entered on FLSD Docket 07/24/2020   Page 5 of 11

HINES vvas a resident ofsliam i, Florida at all tim es relevant to the events described
herein. HINES lists hilnself as authorized represelztative and either lnanager or president of four
com panies that applied for PPP loans.
The 
website 
for the 
Florida 
State 
Division 
of
Corporations
(hdps'.,'/dos.lnyforida.com/stlnbiz/) lists the following infonnation for each of the four companies
(collectively, the CCHINES Companies'l:
Entity Nam e 
Principal Address 
Status as of this
Filin
Unified Relocation Solutions. LLC ($CURS''I 150 SE 2nd Ave 
Active -
ElN 82- 1949494 
M iam i, FL 33131 
Reinstatem ent filed
l 1/16/19
Promaster M overs, lnc. Cpromaster'') 
4000 Hollywood Blvd Inactive
E1N 82-4192745 
Suite 555-5
Hollyavood, FL 33021
Cash in Holdings LLC (û6CIH'') 
8 150 SW  72nd Ave 
Active -
ElN 8 1-35941 54 
Stlite 1822 
Reinstatelnent t'iled
M  ialni, FL 33143 
3/4/20
W e-pack M ovilzg LLC (çCW PM '') 
2054 Vista Parkway 
Active -
E1N 8 1- 1412635 
Suite 400 
Reinstatem ent filed
Name changed to JB Hunt M overs LLC W est Palm Beach, FL 3/4/20
effective 9/3/20 19
HINES is listed as the registered agent for each com pany.
l2. 
The undersigned conducted an Intem et search for these businesses and fotmd no
1
record of any operating websites.
Tlte Lending #/Izl#
13. 
Bank A is a financial institution federally insured by the Federal Deposit Insurance
Col-poration (ççFD1C''). Bank A is based in Charlotte, North Carolina with branches throughout
1 
The only recorded activity of a business online comes tiom reviews on the Better Business Bureau website
for Promaster and I.VPNI. 80th businesses are F-rated buginesses on the site. Based on custoluer comments,
it appears that Pronlaster and TRTPNI acted as brokers for mov àv sen'ices, Virtually all ofthe reviews include
complaints relating to bait-and-switch practices and other deceitful activities.
Case 1:20-mj-03237-JB   Document 1   Entered on FLSD Docket 07/24/2020   Page 6 of 11

the United States. Bank A participated in the SBA'S PPP as a lender and, as such, was authorized
to lend funds to eligible bol-rowers tmder the tenus of the PPP.
### Loan Applications Subm itted ây H INES to Bank ,4
14. 
The govenm zent has obtained and I have reviewed a copy of seven PPP loan
applications that were subm itted by HINES to Bank A. Bank A funded three of the seven loans:
Loan Entity 
Application Number of Amount Sought/claimed 
A mount 
Date
# 
Name 
Start Date 
Emqloyees Average Monthly Payroll Disbursed 
Deposited
Clalmed
(IA'' 
URS 
4/1 8/20 
8 
$ 10,380.00 
$ 10,380.00 
5/1 1/20
//7631 
$40,0O0/'month
idB'' 
CH'l 
5/9./20 
49 
$794,835.00 
$794,835.00 
5/13/20
#6l 06 
$317,934.25/m0nth
ù%C'' 
Prolnaster 5/9/20 
13 
$3, 179,342.00 
$3, l 79,342.00 5/26/20
#6065 
$ 1,271,736.99/m0n1
d(D'' 
LFRS d/b/a 5/10/20 
9 
$6,358,684.00 
Closed by
#t)803 BT M  
$2,543,473,60/n10n1 
BOA
itE'' 
Promaster 5/23/20 
1 70 
S 1,800,000 
Closed by
#2Olt) 
$720,t)00/month 
BOA
.$F'' 
CIH 
5/26/20 
49 
$787,500.00 
Closed by
#6437 
$315,000/month 
BOA
UG'' 
C'H.l 
5/27/20 
49 
$612,000.00 
Closed by
//1 l 32 
S244,800/month 
BOA
Total 
$13,542,741.00 
* ,984,557.00
On each loan application, HINES identitied him self as the m anager and authorized
l-epresentative of the applicant tnusiness. According to Bank A, HINES signed and submitted his
applications electronically through his online Bank A accotmts. HIN ES also subm itted pum orted
copies of Intenzal Revenue Senzice (ççIRS'') tax fonns in support of his applications.
16. 
The proceeds for these accotlnts were to be disbursed in the fbllow ing four Bank' z':t
accotlnts that I'IINE S opelled in N'Iianzi, Florida betweell 20 16 and 2018 (collectively, the ::I-IINES
Conlpallies Accotlnts-'l: ( l ) checki
' ng accoullt x7423 (in the l'lanze of URSI, (2) savings accotmt
Case 1:20-mj-03237-JB   Document 1   Entered on FLSD Docket 07/24/2020   Page 7 of 11

x0857 (in the nalne of URS), (3) checking account x6470 (in the name of Promaster), and (4)
cheeking accotmt x6016 (in the name of CIH).HINES was the sole signer on the CIH and the
URS clzecking accounts, and one of only two authorized sir ers on the Prolnaster checking and
LJRS savings accounts. 1 have reviewed accotmt opening records and bank statem ents for these
accounts from January through June 2020. Bank A verified the identity of HINES when he opened
the Promaster and C1H accounts by recording the nulnber of his Florida driver's license. The sam e
license number and nam e are associated with the registration of the Lam borghini spol-tscar.
False Statem ents tuz ### Applications
17. 
HINES lnade a nunzber offalse represelztations on his PPP loan applications.
18. 
First, HINES m ade false representations regarding the number of enzployees and
m onthly payroll. HINES claimed in the applications to have at least 70 employees and m onthly
payroll of approximately $4 million at the HINES Companies.
19. 
A review of the HFNES Companies Aecounts from January tlzrough April of 2020
shows monthly intlows and outtlows averaging around $200,000- far less than the millions of
dollars in payroll that HINES sought in the PPP applications.
20. 
From January through April 2020, the blmk records show paym ents to at m ost a
dozen dilTerent individuals from HINES Com panies ' accounts. Paym ents identified as work or
paprelated were typically m ade by electronic m oney transfer selwices Zelle or Venm o and in no
case amotlnted to more than $3,000 (e.g., Zelle transfer to CtGerard hvorkf' for $704.81,. Zelle
transfer to iilordan W ork'' for $1,531.64', Check for $1,698, memo line: k:pay throtlgh 2/161').
2 1. 
'lXe Florida Departm ent of Revenue requires em ployers to report records of wages
paid to elnployees by Flori da col-porations as part of 'the paynlent 0f reelnploynzent tax. The
6
Case 1:20-mj-03237-JB   Document 1   Entered on FLSD Docket 07/24/2020   Page 8 of 11

Florida Departlnent of Revenue had no record of wage infonnation paid to em ployees of HINES
Colnpanies froln the t'irst quarter of 2015 through the first quarter of 2020.
### Proceeds Spent on falzxlzry, and Personal Item s, fac/lztfïzlg Lam borghini Sportscar
22. 
M oreover, HINES m ade a number offalse statem ents relating to the use ofthe PPP
funds in his loan applications. For example, HINES electronically certified that:
A11 SBA loan proceeds will be used only for business-related pul-poses as specitied
in the loan application and consistent with the Paycheck Protection Program
lkule . . . .
The funds will be used to retain workers and m aintain payroll or lnake m ortgage
payments, lease paym ents, and utility payments', as specitied under the Paycheck
Protection Prol aln Rule; 1 tmderstand that if the funds are knowingly used for
unauthorized purposes, the federal governm ent m ay hold me legally liable, such as
for charges of fraud. . . .
These statem ents were knowingly false wllen made because, as ftlrtlzer detailed below, HINES
never had the payroll obligations that he claim ed to have, and HINES im m ediately diverted loan
proceeds for unauthorized uses.
23. 
On A' lay 1 1, 2020 and M ay 13, 2020, Bank A deposited $10,380.00 and
$794,835.00 in PPP funds in the respective LJRS and C1H checking accounts. Prior to those
deposits, the respective balances in those accounts were $.30 and -$31,369. 17. Between M ay 1 1
alld May 14, $408, 100.00 in PPP money was transfen'ed from those accounts to the URS savings
accotlnt. There were no other deposits into that account between M ay 1 and M ay 14, 2020, which
opened the m onth with a balance of $8,693.08. On M ay 18, 2020, a wire for $318,497.53 was sent
ti-om LJRS savings account to ::C:U' Dealership'' with the following note: çt am borghini Huracan
EV0 ''
Records froln ttcal- lAealership'' shoAv HINES, identifsed by llis lk-lorida driver-s
license, purchased a Lalnbor ini sportscar (vehicle 
identification nunlber
Case 1:20-mj-03237-JB   Document 1   Entered on FLSD Docket 07/24/2020   Page 9 of 11

ZHWLJF4ZF3LLA13255) for $3 18,497.53 on May 18 in North Miami Beach, Florida. Florida
departlnent of motor vehicles records show the Lamborghini sportscar is registered jointly in the
nam e of HINES and Unified Relocation Solutions LLC, a self-described lnoving com pany.
25. 
The largest paynzents drawn on these accotmts in M ay and Jtme are listed below.
There does not appear to be any tnusiness purpose for m ost, if not all, of these expenses.
Date
5/13/20
5/14/20
5/27/20
5/27/20
6,/3/20
6/5/20
6/8/20
6/8/20
6/9/20
6/10/20
6/' 10/20
6/15/20
6/ 1 5,/20
6,/22720
Payee 
Am ount
ltklom'' 
$15 000.00
>
HINES cash 
$9,500.00
ççNlom'' 
$15 000.00
Saks Fifth Ave 
$4,622.40
Subject B 
$15,000.00
Fontainebleau M iami 
$4,089.00
H INES cash 
$9,500.00
Subject A 
$10,000.00
Subject C 
$15,000.00
The Setai Hotel Miami Beach 
$7,264.97
Subject C 
$6,200.00
Subject D 
$5,000.00
Grat'r Diam onds 
$8,530.00
The M iam i Beach E 
$5,988.02
26. 
M any of the sm aller paym ents lnade from the HINES Companies Accounts in M ay
and June were for rideshare and food delivery services. HINES him self does not have any personal
accotmts at Bank A but appears to use the HINES Companies Accotmts for personal purposes.
Balzk A closed the HINES Companies Accounts on June 24, 2020. 'Ihe account
balances tetaled $3,463, 162.68 and there have been no repayments on the loans.
Conclusion
28. 
Based on my training and experience, and the infonnation provided in this atxdavit,
l l'espectfully subm it that there is probable cause to believe that:
On 01- abotlt N,faJ,' 9, 2020, in the Southem District 01:- Florida and elsewhere, the
defendant, DAVID 7-. IIINES. did km oAvingly lnake a false statenzent and report for
the ptu-pose of influencing the aetion 017 a tinancial instittltion whose deposits are
insured by the Federal Deposit lnsurance Corporation in connection w ith a loan
Case 1:20-mj-03237-JB   Document 1   Entered on FLSD Docket 07/24/2020   Page 10 of 11

application, in that the defendant falsely represented on his application for a PPP
loan to Bank A that he had average monthly gayroll for his companj Cash in
Holdings LLC of approximately $245,135, in vlolation of Title l8, Unlted States
Code, Section 1014.
On or about M ay 13, 2020, in the Southern District of Florida and tlsewhere, the
defendant, DAVID T. HINES, did knowingly, and with intent to defraud, execute,
and attem pt to execute, and cause the execution of, a schem e and artifice to defraud
a financial institution, which scheme and artifice employed a m aterial falsehood,
and did knowingly, and with intent to defraud, execute, and attempt to execute, and
cause the execution of a scheme and artifice to moneys and funds owned by, and
under the custody and control of a financial institutlon, by means of false and
fraudulent gretenses, representations, and promises relating to a material fact, that
is, by causlng Bank A to deposit $794,835.00 into an account controlled by the
defendant, in violation of Title 18, United States Code, Section 1 344.
On or about M ay 18, 2020, in the Southern District of Florida, and elsewhere, the
defendant, DAVID T. HINES, did knowingly engage and attempt to engage in a
monetary transaction affecting interstate and foreign com m erce in criminal derived
property of a value greater than $10,000, which the defendant knew was derived
from a specified unlawful activity, to wit: tht purchmse of a 2020 Lamborghini
sportscar in tht amount of $318,497.53, which funds represented tht proceeds of
funds obtained through W ire Fraud and Bank Fraud, in violation of Title 18, United
States Code, Section 1957.
*
FURTHER YOUR AFFIANT SA YETH NAUGHT.
>
Bryantm smela
Unlted States Postal lnspector
Attested to by the Applicant in accordance with the requirements of
Fed.R.Crim .P, 4.1 by 'relephone this 23 
day of Jtlly 2020.
HONORABLE J 'QUELINE BECERRA
UNITED STAT M AGISTRATE JUDGE
SOUTHERN DISTRICT OF FLORIDA
9
Case 1:20-mj-03237-JB   Document 1   Entered on FLSD Docket 07/24/2020   Page 11 of 11

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