Lil Wayne. Photo by Bennett Weglin/Getty Images
Successful musicians and professionals from across the industry received grants from a COVID-era program meant to help struggling venues pay their bills during the pandemic, a new Business Insider report alleges.
The Shuttered Venue Operators Grant (SVOG) was a $200 million fund signed into law by President Donald Trump in 2020 and branded as a resource for independent venues and arts organizations. While some of the funds made it to these targets, accountants for wealthy individuals in the music industry were able to obtain SVOG grants via "loan-out companies," or businesses that organize artist tours.
The Business Insider report is based on "thousands of pages of accounting documents" that allegedly reveal the wide cross-section of wealthy individuals who received funds and what they spent it on. They include Lil Wayne, who allegedly received an $8.9 million grant and used it for expenses such as "two years' worth of spending on luxury hotel stays, designer clothes, and travel to and from nightclub appearances around the country." The money also went towards settling a debt with an ex-manager Cortez Bryant ($2.1 million) and commissions to his then-manager, Mack Maine ($1.71 million). Just $327.3K was allegedly spent on contractors working on his shows.
Several other well-known musicians are named in the report. Chris Brown's touring company CBE Touring received a $10 million grant, according to the report, $5.1 million of which was reportedly personally pocketed by the singer.
Marshmello was given a $9.9 million grant. Per Business Insider, his business manager Steven Macauley claimed to the Small Business Administration, the department that oversaw the grant program, that all of it was taken by the popular EDM DJ.
Alice In Chains, the multiplatinum grunge rock band, received a $4.1 million grant, $3.4 million of which reportedly went to its three main members. (That same year, Alice In Chains shared a GoFundMe page for Scott Dachroeden, a guitar tech for the band who was diagnosed with cancer.)
Companies representing Rae Sremmurd, Steve Aoki, and more are also named as beneficiaries of the program. None of the artists named in the report responded to requests for comment by Business Insider, though the report notes that Wayne "made a sexually explicit overture to a reporter and did not respond to questions." The FADER has also reached out to the relevant artists for comment.
To receive a SVOG grant, the applicant was required to "make a good-faith statement" that the funds (which could not exceed $10 million) were required to maintain "ongoing operations" of the company, per Business Insider. The applying companies were also required to show proof that revenue had declined "by at least 25% between one quarter of 2019 and the same quarter of 2020." Because an applicant's assets were not taken to account, extremely wealthy individuals like the ones named in Business Insider's report were allowed to apply.
The conduct alleged in the report represented "an abuse of federal resources," according to Sen. Gary Peters, who told Business Insider that it underscored the need for additional oversight. Whether or not the activity constitute fraud is unclear, said former comptroller general David Walker. "Whether it's legal or not is up to a lawyer or ultimately to a court. But it sure smells."
