Florida Business Owner Got $3.9 Million in Coronavirus Relief Money, Allegedly Spent It on a Lamborghini

Summary

A CNBC Make It article by Tom Huddleston Jr., published July 29, 2020, reporting that federal prosecutors are accusing David T. Hines, a small business owner in Miami, of spending Paycheck Protection Program (PPP) loan money on a 2020 Lamborghini Huracan, jewelry and luxury resorts. It says Hines was charged in Miami Federal Court 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, according to the Justice Department's press release. The article reports allegations that Hines received more than $3.9 million in PPP loans and that the Lamborghini cost roughly $318,000. It states that the lawyer representing Hines, Chad Piotrowski, declined to comment.

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3/30/22, 12:22 PM Florida man allegedly spent coronavirus relief money on a Lamborghini

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Florida business owner got $3.9 million in coronavirus
relief money, allegedly spent it on a Lamborghini and
luxury hotels

Published Wed, Jul 29 2020°12:10 PM EDT

4 Tom Huddleston Jr.

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Luxury Italian automaker Lamborghini's 2020 Huracan sports car. Source: Automobili Lamborghini S.p.A.

Federal prosecutors are accusing a 29-year-old small business owner in Miami of

spending some of the nearly $4 million in coronavirus relief aid he received from the

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3/30/22, 12:22 PM Florida man allegedly spent coronavirus relief money on a Lamborghini

government on a six-figure sports car, expensive jewelry and stays at luxury resorts.

Federal officials arrested the man, David T. Hines, on Monday, charging him in Miami
Federal Court 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 Justice Department said in a press release.

After Hines obtained approval for three Paycheck Protection Program (PPP)
applications and received more than $3.9 million in PPP loans, federal prosecutors
allege he used those funds to go on a spending spree that included a 2020
Lamborghini Huracan that Hines bought for roughly $318,000 within days of

receiving the government aid.

In fact, for weeks after receiving the millions of dollars in PPP aid, "Hines did not
make payroll payments that he claimed on his loan applications," the Justice
Department says in its press release. Instead, in addition to buying the six-figure
Lamborghini that was registered jointly in Hines’ name and in the name of one of his
companies, Hines allegedly spent tens of thousands of dollars at luxury retailers and

luxury resorts in Miami Beach.

Prior to receiving the government PPP funds, one of Hines’ bank accounts had a
balance of just 30 cents, while another that later received nearly $800,000 of his
PPP funds previously had a negative balance of more than $31,300, according to the

government's complaint.

After receiving the PPP money, Hines’ financial records show that he made two May
payments of $15,000 each to a person listed as "Mom," according to officials. Other
payments in the months of May and June include $4,622.40 spent at Saks Fifth
Avenue and $8,530 to the luxury jewelry company Graff. The government's
complaint also alleges that Hines spent a total of more than $17,300 at three luxury
resorts in Miami Beach: the Fontainebleau, the Setai Hotel, and the Miami Beach
Edition.

According to the government's criminal complaint, Hines is officially listed as “either

manager or president” of four different moving companies located in South Florida,

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3/30/22, 12:22 PM Florida man allegedly spent coronavirus relief money on a Lamborghini
all of which applied for relief money through the federal government's Paycheck
Protection Program. Since March 2020, the government has approved nearly $520
billion in PPP loans to over 5 million small businesses that have seen their revenue

drastically reduced by the ongoing coronavirus pandemic.

Hines requested roughly $13.5 million in PPP loans for those four businesses in April,
while allegedly falsely claiming that those companies had paid $4 million in total per
month to more than 70 employees in the first quarter of 2020, prosecutors wrote in

the complaint.

However, the government says that "those purported employees either did not exist
or earned a fraction of what Hines claimed in his PPP applications” and that bank
records “show little to no payroll expense during this period” for Hines’ companies.
(Instead, monthly expenses for Hines’ companies totaled around just $200,000 in the

first quarter of 2020, according to the complaint.)

Meanwhile, the complaint also notes that there are no records of any of Hines’ four
businesses having “any operating websites.” In fact, two of his companies, which the
complaint notes seem to have been brokers for moving services, both have F-ratings
on the Better Business Bureau website and a history of complaints "relating to bait-
and-switch practices and other deceitful activities,” according to the criminal

complaint.

If Hines is convicted on all charges against him, he could face up to 70 years in

prison, prosecutors told The New York Times.

The lawyer representing Hines, Chad Piotrowski, declined to comment on the case
when reached by CNBC Make It.

The charges against Hines also come at a time when the federal government
continues to face questions and criticism over how it has doled out billions of dollars
in PPP loans. In May, a study conducted by the New York Federal Reserve found that
the states hit hardest by the coronavirus (at that time) were receiving a smaller

proportion of emergency small business loans than other states.

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3/30/22, 12:22 PM Florida man allegedly spent coronavirus relief money on a Lamborghini
Data released by the Small Business Administration in early-July listing recipients of
PPP loans and grants also raised some eyebrows, as large companies and celebrities
like Kanye West received millions of dollars in loans for his clothing and sneaker
company, as did billionaire real estate developer Joe Farrell and multimillionaire

artist Jeff Koons.

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