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During the 2020 COVID-19 pandemic, the federal government issued the Shuttered Venue Operators Grant law to help keep the recording industry afloat after performing live — one of the industry’s main sources of income — became impossible due to live venues being shut down. However, in a new report from Business Insider, several entertainers, including Chris Brown, Lil Wayne, and Marshmello, are being accused of abusing those funds, using them to fund travel, parties, and luxury shopping sprees instead of paying employees and keeping the lights on.
Brown, who received a $10 million grant, reportedly spent $80,000 on his birthday party, which included models in body paint, an LED dance floor, and $29,000 worth of hookahs, bottle service, and fees incurred by damages to couches rented for the occasion. More than double that was spent on a celebrity basketball tournament broadcast on YouTube. Meanwhile, Lil Wayne, who received $8.9 million, allegedly spent the funds on private-jet flights ($1.3 million), luxury clothing ($460,000), and accommodations for female companions ($15,000) whose connections with Wayne are “unclear,” per BI.
Marshmello’s manager told the publication, however, that the DJ paid himself out of the $9.9 million grant he received. He “expensed the entire Grant balance to Payroll” via a loophole that allowed the SVOG funds to go to the artists’ business entities as “owner compensation” provided it was less than their income in 2019. They also had to show that their companies made 25% less in 2020 than in 2019 — which was more or less a given, considering how much of their income is made up of touring and live performances. This is how Steve Aoki paid himself $1.9 million out of a $2.4 million grant, Rae Sremmurd gave themselves $7.7 million, and Alice in Chains members Jerry Cantrell and Sean Kinney received $1.4 million each (Mike Inez took $682,000).
Meanwhile, the report says that while stars like Lil Wayne did use funds to pay their managers, attorneys, and agents, it was more than 13 times what sound techs and other contractors received. The Small Business Administration says it has recovered some misappropriated funds, but is still investigating open claims.
