While it may seem like the economy is a free-for-all right now, a Florida man found out the hard way that there are still rules and laws in effect – even with stimulus funds.
Allegedly, David T. Hines of Miami, Florida took advantage of the situation when the CARES Act was passed, applying for a Payroll Protection Program loan. In fact, Hines applied for $13.5 of funds based on his four companies and massive payroll burden.
The only thing is that Hines fraudulently inflated those payroll expenses and maybe even fabricated information about his companies (allegedly). Still, he was awarded a PPP loan for $3.9 million.
Instead of using the funds for any legitimate business or payroll expenses, Hines (not allegedly anymore!) went on a luxury shopping spree on Miami Beach, stashed $3.4 million in his mattress so he wouldn’t have to put it in a bank, and went car shopping with the rest.
So, what did Hines purchase? A brand-new Toyota sedan? One of those nice new Ford Broncos? Well, this is South Florida we’re talking about, so maybe it was a high-end BMW?
No, the foolhardy Hines went out and purchased a 2020 Lamborghini Huracan.
The price tag? A cool $318,000.
No matter how you cut it, that’s fraud, and it wasn’t hard for the Department of Justice to see the red flags. Once they filed a criminal complaint against Hines, they found that he had doled out tens of thousands of dollars to his mom, purchased diamonds, and lived like a billionaire for a few months…with PPP and, therefore, taxpayer funds.
Of course, the DOJ seized the remaining cash, the gifts, and the Lamborghini.
Mr. Hines is facing criminal charges in the Southern District of Florida including “making a false statement to a lending institution, bank fraud, and engaging in transactions in unlawful proceeds.:
It’s not clear if Mr. Hines will be taking the bus to his upcoming court case, but he certainly won’t be driving a brand new $318,000 Lamborghini!
While this story is entertaining, please also take it as a serious cautionary tale, as PPP funds or any economic stimulus does not equate to a blank check, and we expect a large number of criminal charges against people who tried to cheat the system – including the Internal Revenue Service.
If you received a PPP loan and want to make sure you do things correctly, just make any appointment with my office at the link below.