COVID Feature: Poor Little Rich Boy

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Miami is typically known for its beaches and all-night parties. Unfortunately, it’s getting a new reputation for being home to fraudsters looking to exploit loans intended for those financially suffering due to COVID-19.

David Tyler Hines of Miami, Fl., is charged with bank fraud for fraudulently filling out Paycheck Protection Program (PPP) loan applications and using the allocated fund on luxury items. (Hines is a businessman that owns several companies, but it appears that many of his operations are less than legitimate.)

Over $521 billion in funds were designated to PPP loans through the CARES Act to help ensure small businesses could stay afloat and retain workers during the difficult economic times caused by the novel coronavirus pandemic. The loans are low interest and forgivable for businesses who properly use the funds for payroll expenses. (There is surprisingly no loan forgiveness for those who use the funds to finance their own lifestyle.)

Hines applied for $13.5 million in PPP loans claiming that four of his companies needed the funds for payroll expenses. He was allocated nearly $4 million in loans with the intention that they be used to pay his employees.

It was revealed through an investigation that the employees listed for the companies did not exist or had salaries worth a fraction of what Hines claimed on the application. (Furthermore, several of the companies that were allocated funds had less than pristine reputations.)

Two of the companies that Hines noted on his applications were listed on the Better Business Bureau’s website as practicing questionable business tactics such as “bait-and-switch’ methods. Another one of the companies listed on Hine’s application had not filed annual reports with Florida’s Department of State in several years.

Where did the funds go if not to his companies? (Keep in mind that he should have never received these funds.) Hines used the funds provided through the PPP loans to bankroll his expensive lifestyle. He purchased a Lamborghini Huracán EVO worth $318,497.53. (Where does he think he’s driving to during the middle of a pandemic?)

A few of Hine’s other extravagant purchases included spending $5,000 at Saks Fifth Avenue, over $11,000 at Miami hotels, and more than $8,000 at Graff Diamonds. His lawyer made a statement insisting that Hines has “suffered financially” just like millions of Americans and that these purchases aren’t as they appear. (Let’s be real here. It appears that Hines went on a luxurious spending spree on the government’s and taxpayers’ dime.)

Hines faces up to 30 years in prison and up to a $1,000,000 fine if found guilty for bank fraud, up to 30 years in prison and a $1,000,000 fine for false statements to a lending institution, and up to ten years for engaging in transactions in unlawful proceeds. (In case you needed more affirmation that Hines is a rule breaker, he was recently charged $100 for refusing to wear a mask in public.)

Today’s “Fraud of the Day” comes from an article, “Man spent PPP funds on hotels, jewelry and $318,497 Lamborghini, authorities say,” published by CNN on July 28, 2020.

A man in Miami, Florida, has been charged with bank fraud for allegedly lying on PPP loan applications and spending the money on luxury items such as a Lamborghini Huracán EVO, federal authorities say.

Funds from the $521 billion Paycheck Protection Program are destined for small businesses so that they’re able to keep workers on payroll throughout the coronavirus pandemic.

 

 

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Larry Benson, Senior Director of Strategic Alliances, LexisNexis Risk Solutions - Government

Larry Benson is responsible for developing strategic partnerships and solutions for the government vertical. His expertise focuses on how government programs are defrauded by criminal groups, and the approaches necessary to prevent them from succeeding.

Mr. Benson has 30 years of experience in sales and business development. Before joining LexisNexis® Risk Solutions, he spent 12 years founding and managing two software technology startups. During the 1990s he spent 10 years as a Regional Director helping to grow a New England-based technology company from 300 employees to 7,000. He started his career with Martin Marietta Aerospace working on laser guided weapons and day/night vision systems.

A sought-after speaker and accomplished writer, Mr. Benson is the principal author of “Fraud of the Day,” a website dedicated to educating government officials about how criminals are defrauding government programs. He has co-authored WTF? Where’s the Fraud? How to Unmask and Stop Identity Fraud’s Drain on Our Government, and Data Personified, How Fraud is Changing the Meaning of Identity.

Benson holds a Bachelor of Science in Physics from Albright College, and earned two graduate degrees – a Master of Business Administration from Florida Institute of Technology, and a Master of Science in Engineering from Lehigh University.