David Hines, from Miami, Florida, is alleged to have amassed $3.9 million (£3m) through fraudulent loan applications, spending $318,000 (£245,702) of this on a 2020 Lamborghini Huracan.
The 29-year-old is also said to have made numerous purchases at luxury retailers and resorts in Miami Beach.
Officials announced yesterday (Monday) that Hines had been arrested and charged with three felonies: bank fraud, making a false statement to a lending institution and engaging in transactions with unlawful proceeds.
If found guilty of all charges, an official in the prosecutor's office said Hines could face up to 70 years in prison, according to The New York Times.
Hines is alleged to have sought around $13.5m ($10.4m) through the US Paycheck Protection Program (PPP) - which is designed to keep people in employment during the coronavirus pandemic.
Hines' applications claimed he employed more than 70 people, with a monthly payroll of $4m (£3.1m). The bank approved three of his applications, totalling $3,984,557 (£3.1m).
A statement released by the Department of Justice read: "The complaint alleges that Hines sought approximately $13.5m in PPP loans through applications to an insured financial institution on behalf of different companies.
"The complaint alleges that Hines caused to be submitted fraudulent loan applications that made numerous false and misleading statements about the companies' respective payroll expenses. The financial institution approved and funded approximately $3.9m in loans.
"The complaint further alleges that within days of receiving the PPP funds, Hines purchased a 2020 Lamborghini Huracan sports car for approximately $318,000, which he registered jointly in his name and the name of one of his companies.
"In the days and weeks following the disbursement of PPP funds, the complaint alleges that Hines did not make payroll payments that he claimed on his loan applications. He did, however, make purchases at luxury retailers and resorts in Miami Beach."
Hines' lawyer, Chad Piotrowski, said in a statement that his client was 'a legitimate business owner who, like millions of Americans, suffered financially during the pandemic', adding that Hines is anxious to tell his side of the story.
Hines was held over the weekend at the Federal Detention Center before being granted a $100,000 (£77,275) bond by Magistrate Judge John O'Sullivan and allowed to stay at his mum's house with a GPS monitor, according to The Miami Herald.
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