Wheeler-dealer skates through one accusation after another
So many former NFL players were burned that the NFL and the NFL Players Association issued advisories citing Coriaty’s ‘questionable business practices.’
Over two decades, David Coriaty has left a trail of jilted clients, girlfriends and investors who have accused him of being a financial flimflam artist, according to an investor lawsuit filed by a disgruntled corporate director, several court depositions, a Palm Beach County detective, Coriaty’s FBI file and interviews with more than a dozen investors.
When Texas-based Associated Aircraft Supply was desperate to acquire bulk quantities of COVIDfighting hand sanitizer near the start of the pandemic, the firm made a business deal with personal protective equipment (PPE) broker DNA Distro LLC of Florida.
It was fairly straightforward: DNA Distro, a Palm Beach County company run by a man named David Coriaty, promised to arrange for the supplies — 30,000 units at $2.70 per bottle. Associated Aircraft would wire $81,000 to an account.
A Florida Bar complaint against Coriaty’s lawyer describes what happened next: The Texas company sent the $81,000 to the account as instructed. The money was drained. And the aircraft supply company got … nothing. Not a drop of hand sanitizer. The Bar complaint was dismissed, because the lawyer managing the account was not party to the business deal between DNA and Associated Aircraft Supply. End of story.
For those who do business with the 52-year-old Coriaty, getting nothing is nothing new.
Over a career spanning two decades — while running a variety of businesses and acknowledging in a sworn statement spending millions on sports cars, Las Vegas junkets, chartered jets, Miami Dolphins skyboxes and expensive jewelry for a string of female companions — the South Florida man has left a trail of jilted clients, girlfriends and investors who have accused him of being a financial flimflam artist, according to an investor lawsuit filed by a disgruntled corporate director, several court depositions, a Palm Beach County detective, Coriaty’s FBI file and interviews with more than a dozen investors, some of them former NFL players.
Coriaty courted some investors by taking them to Miami Dolphins games, where they discussed business in style in a luxury suite.
Several of his investors say he wooed them by claiming to be a former Dolphins player, although records show the last time he strapped on a football helmet was at Palm Beach Gardens High. The six-foottwo, muscular, tattooed businessman could pass for a pro linebacker but denies ever making such a claim. In fact, Coriaty is a community college dropout who ran strip clubs before shifting to more lucrative endeavors.
In spite of the dozens who have stepped forward to accuse Coriaty, virtually all of whom describe similar experiences in sworn depositions, statements to investigators, police reports, or interviews with the Herald, he has never been criminally charged with fraud — a fact he is quick to point out — or for that matter sanctioned civilly. One lawsuit took years to wind its way through the courts, only to be dismissed on procedural grounds. It was filed by an investor who doubled as a director of a Coriaty-run corporation.
“All crap,” Coriaty said in an interview, when asked about the long list of complaints.
“I was investigated by the FBI, the SEC, the IRS, the DEA, the DOJ … not one indictment,” he told the Herald. “Not one criminal charge. I was found innocent of any of those allegations.” Records back him up.
Coriaty’s public records trail consists of a slew of roughly three dozen traffic tickets, including one in August 2018 for “habitual offender,” and four domestic violence arrests, all eventually dropped, and a handful of evictions. He has one other recent memorable brush with the law, a traffic encounter last August in Monroe County that landed him in jail.
In the Keys incident, at mile marker 51, deputies confronted Coriaty in his Mercedes convertible at a Wendy’s after a “road rage” incident in which a witness said a man sped through a no-passing zone, passing other motorists, while flashing a chrome revolver. The Mercedes smelled of marijuana, deputies wrote in their report. When they searched the car after putting Coriaty and his female companion in cuffs, they reported finding cocaine, amphetamines, ecstasy, marijuana and a 300 mg bottle of the steroid nandrolone decanoate.
Secured in the rear seat of the police cruiser, accompanied only by his passenger, who was not charged, Coriaty alternately denigrated the deputies as they pulled evidence from his car and muttered that he couldn’t believe he was being arrested on his birthday, and over drugs intended only to fuel a weekend of celebratory partying. Coriaty must have been unaware that every utterance was captured on audio and video.
He was charged with possession of a weapon in the commission of a felony (for the drugs). In an interview, Coriaty declined to com
ment on the incident because the case is pending.
CAR GADGETS AND COVID GEAR
The first business accusations against Coriaty stem from a Florida-based company founded in the early 2000s — Hawk Systems — that was set up to market a device for preventing car thefts. Coriaty said his gadget, which used biometric fingerprint technology, would stop anyone except the owner from cranking up a car’s ignition. No key was needed. Hawk never produced any inventory, though Coriaty swore in a deposition in the investor lawsuit that there was a prototype, including one in his personal vehicle. He racked up a list of former football players as investors who now say he got them each to toss in as much as $250,000, money they never saw again. The players included Bryant McFadden, Greg Jones, Alex Barron, Anquan Boldin and Phil Buchanan.
So many former NFL players were burned that the NFL and the NFL Players Association issued advisories citing Coriaty’s “questionable business practices.”
“Investigation by NFL Security has determined that the above individuals may be targeting current and/or retired NFL Players as potential investors,” the league advisory said.
“If you know anything about the NFL, careers aren’t long. So when we’re in the game, we’ve got to capitalize on every opportunity that we can to make sure that we and our loved ones are taken care of,” said Jones, who played fullback for the Saints, the Jaguars and the Texans and told the Herald he invested $125,000. “But instead, he stole everything. Any investment is a risk, and we know that.
But this wasn’t an investment. This was a highway robbery.”
McFadden, who claimed he lost $200,000 to Hawk Systems, agreed. “We’ve made some investments — some work out, some don’t. But this was a straight-up Ponzi scheme right there. It was bad. It was robbery.”
Still, the former NFL players suggested that in some ways, they were lucky. Or at least, luckier than some.
“At least we’re still young,” McFadden, a one-time Florida State Seminole who played cornerback for the Steelers and Cardinals, told the Herald. “We’re not making nearly as much as we were while we were playing football, but we can still live comfortable lives.”
But there were elderly individuals who lost their entire life savings, he added.
“They gave him all of their retirement savings thinking that this was going to be a generational cushion for themselves and their loved ones, and he stole it all,” said McFadden. “It’s hard to bounce back from something like that. I can’t even imagine it.”
Although he acknowledges the PPE debt to Associated Aircraft Supply, Coriaty says he never stole anything from anybody and blames the problems at Hawk on a disgruntled investor and corporate director who, he says, crippled the company after growing unhappy with Coriaty’s stewardship. Coriaty said he’s on very good terms with several of the now-former NFL players.
“I guarantee you that if I called Bryant McFadden right now and he would answer that call — he never said that to you,” Coriaty told the Herald, when informed of McFadden’s quote.
Not according to Bryant McFadden: “I have not spoken to David Coriaty in a very long time. We actually stopped talking on the phone after he could no longer come up with any more excuses for where my money went or what was going on at Hawk. Myself, my friends and many others who invested in Hawk feel robbed and taken advantage of. I honestly cannot believe that in this day and age, the legal system has allowed this act of negligence to go unpunished.”
After Hawk went bust, Coriaty transitioned into running an outfit called PROCAP. This time, his investors told the Herald, he sought capital not from football players but elderly individuals, including allegedly $675,000 from one man in West Palm Beach.
The COVID-19 pandemic presented a new frontier. Coriaty became a PPE broker, using the alias David Columbo. In his interview — which he cut short, hung up on, then fired off a flurry of angry texts — Coriaty said he was forced to assume a new name because inaccurate articles in the Herald and other news media have unjustly sullied his reputation.
Early in the pandemic, the demand for PPE was so robust that customers were willing to pay up front for a promise that the goods would be delivered later. Jason Frazier, the owner of Associated Aircraft Supply, is not the only customer who says he paid only to get nothing in return. Two dentists from New Jersey, who asked not to be identified in this article, claim they lost $750,000 to Coriaty.
“He never had any intention of paying me back. I requested my money for multiple months and it was just excuse after excuse, until things got heated and he called me a whiny little b-tch because I was worried over $81,000,” said Frazier. “He told me he keeps 10 times as much in his couch cushion and he could pay me back anytime. So I said how about now? And that didn’t go over very well.”
Frazier didn’t sue Coriaty personally after the Bar complaint was dismissed, but not because he thought Coriaty was honorable in his dealings. He didn’t.
“I just thought it was going to be throwing good money away,” he said.
MERCEDES, A LAMBORGHINI — AND NO SALES
Hawk Systems was that rare public company that took in millions in investments but never sold a product or service, functioning more as a piggy bank. Total Hawk sales revenues were $0, according to both Coriaty’s 2012 deposition in the investor lawsuit and a 2009 public filing that is included in the FBI file. In the deposition, Coriaty admitted to spending seven-figure amounts on personal expenses but his recollection was foggy and he could give little or no documentation to support the expenditures.
He acknowledged spending hundreds of thousands of dollars on multiple luxury cars, including a $120,000 Lamborghini (he says that was a lease) and on casino debts, jewelry, travel and meals. He spent $8,600 from a Hawk account at Wheels Boutique but doesn’t remember the reason. It’s a store that supplies custom car rims.
The deposition was the result of a shareholder “derivative” lawsuit, meaning one in which a shareholder sued on behalf of the corporation itself. It was brought by an investor who doubled as a corporate director, Mark Spanakos, who invested $1 million in Hawk and then loaned Coriaty an amount greater than that personally.
Coriaty said under oath he spent money from Hawk’s coffers on whatever he wanted whenever he wanted because he worked hard for the company and was granted a $500,000 salary by the board. Rather than collect a regular paycheck, he explained, he simply withdrew money as needed.
“If I wanted to take $40,000 a month and burn it, that’s my prerogative,” he said in the deposition. “It’s my money to do what I want with it.”
A 2009 sworn declaration from an outside accountant brought in by Spanakos to examine Hawk’s books stated that the company was being run in a way that violated SEC standards. The accountant, Lori Jones, wrote that Coriaty took out as much as $785,000 per year, considerably higher than his salary. She flagged “flagrant disregard” for a resolution that all expenditures be supported by receipts.
She said the board ignored her advice, which was to file an 8-K Report, a document submitted to the SEC that tells shareholders information that might inform their decision making going forward. Among the expenditures that raised Jones’ eyebrows was a check from Hawk to Coriaty’s then-girlfriend for $10,759 with no explanation.
POINTING FINGERS
In both an interview with the Herald and the 2012 deposition, Coriaty claims that all his money problems and those of his investors are the fault of one man: Spanakos, a retired Wall Street trader.
“Mark Spanakos is the culprit of them losing all their money,” Coriaty said in response to a question about his accusers’ claims that Hawk was in fact a Ponzi scheme. “We had deals with Ford, AmTrust, American Express, MasterCard, I mean we had all these companies ready to go and sign contracts with us and Mark Spanakos basically sent out threatening lawsuits saying that if they did business with us, he would sue them.” Spanakos denies that.
Investors and even former employees have called into question some of the purported backing — or near backing — from big-name companies.
Rachel Ehrenreich, who was once engaged to Coriaty and whose parents invested with him and lost their retirement money, said that when her parents became concerned about their investment Coriaty produced a fake press release from Ford that linked to a story in Fortune magazine. The release said the automaker was collaborating with PROCAP to install biometric sensors in cars — which, if true, could have been a bonanza for Coriaty and his investors. A link on the press release led to a story whose text was behind a paywall, accessible only to Fortune subscribers. When the Herald accessed the story, it talked about biometric technology but made no mention of PROCAP.
Ehrenreich said Coriaty also tried to assuage her and her parents’ concerns by sharing with them an email from a D. Robinson, purportedly president of a company called Am Trust Global. Subject: “Release of funds.” “Hope your (sic) having a great weekend. Wanted to let you know we will be releasing funds to your escrow account on Thursday this week,” the email from Robinson says.
The Oct. 15, 2017, communication explains that Coriaty and his lawyer would be getting a total of $26.5 million in two payments.
“Again congratulations and have a great weekend.”
Instead of an official company address, Robinson’s email to Coriaty originated from a Yahoo account, deborahrobinson438@yahoo.com. The Herald could not verify the existence of Am Trust Global. There is a large, similarly named company, AmTrust Financial Services Inc., but it is a New York-based multinational insurance company. There is no trace of anyone named Deborah Robinson on AmTrust’s online manager profile.
There is an account in the name of Deborah Robinson on LinkedIn, and it says she is from Boca Raton, in the county where Coriaty lives. Her account — which identifies her not as the president of Am Trust Global but as a consultant to the similarly named AmTrust Financial Services — has zero posts, zero shares, zero comments and, as far as the Herald could determine, zero connection to Coriaty. The Herald reached out to the Yahoo account from which the message trumpeting the $26.5 million in financing originated, but the address is defunct.
In a subsequent exchange of texts with the Herald, Coriaty said the lucrative financing deal that was to provide him $26.5 million within a week’s time fell through. One reason, he said: The “procuring officer” committed suicide.
The Herald could not verify many of the deals and near-deals described by Coriaty. American Express and MasterCard denied any connection to Coriaty.
COLORFUL CAST OF ASSOCIATES
Spanakos told the Herald that he met Coriaty in 2006 through a colleague and close friend. He was so impressed by the idea of biometric devices in cars that he agreed to become not just an investor but a director of the corporation.
“The fingerprint technology just seemed like a great idea, because at the time the whole country was going crazy with security after 9/11,” he said.
Spanakos said he functioned as a director for around two years before he became concerned that as investor money was coming in it was almost instantly being drained — spent on Coriaty, his associates, consultants and financial advisors.
Two of those associates, Robert and John Pate, now 73 and 80 respectively, were reputed former members of New York City’s Colombo crime family. John Pate started working at Hawk shortly after being released in 2003 from a 10-year stretch for loansharking. In addition to being shareholders in the company, both brothers also worked as “special consultants” for Hawk Systems, according to public records.
Still another director, Alan Aronson, got into trouble after Hawk imploded. He had two subsequent arrests in 2012 — one in which he was alleged to have defrauded Marriott Towne Place Suites in Boca Raton with a forged U.S. Postal Service money order and another in West Palm Beach for allegedly writing a worthless check of $12,900 to auto dealer
The Ram Group.
The first case was dropped and the second led to an order to pay restitution and spend 33 days in jail.
One of the oddest satellites in Coriaty’s orbit was Daniel Baldwin of the acting Baldwin brothers, who has a history of arrests and drug rehabs. He produced a video — personalized to “John,” apparently referring to a jittery investor — in which the bewhiskered actor, cloaked in what looks like a hoodie, says of Coriaty and his company: “You can trust these guys with your kids,” adding that Coriaty, whom he calls Columbo, always pays on time and is well-respected.
“I just wanted you to know from the heart without any of the other nonsense,” he said at the end of the video, tapping his chest with his palm.
Efforts to reach Baldwin through his agent and his lawyer were unsuccessful.
INVESTIGATIONS, AND THEN NOTHING
And yet Coriaty has never been charged with anything connected to his money-losing businesses, his prolific spending of investor money or his failure to provide paid-for
products. But he has been investigated. According to the deposition of a detective with the Palm Beach County Sheriff’s Office, Hawk appeared to be a Ponzi scheme with hundreds of investors. The deposition was taken as part of a slander suit filed by a Coriaty associate, drafted by Coriaty’s longtime lawyer. The lawsuit claimed Spanakos was talking to the plaintiff’s clients, saying she was involved in a Ponzi scheme with Coriaty. The suit was eventually dismissed for lack of activity.
Spanakos first reported Coriaty and his associates to the Federal Bureau of Investigation in February 2009. The FBI’s thick, heavily redacted file on Coriaty — which appears to have started as a Securities and Exchange Commission inquiry — cites multiple investors but the actual names are redacted. It ends with “based on the suspected criminal activity, it is suggested that [redacted].”
There’s no telling what [redacted] is but 10 years later there is no indication whatever it is or was happened. None of the 16 people with whom the Herald spoke ever saw their money again.
Spanakos told the Herald that, before contacting the FBI in early 2009, he complained about Coriaty to the SEC and IRS.
Spanakos is frustrated with authorities. He says he wore a wire for the FBI during several meetings with Coriaty and his associates over the course of a year, ending in June 2010. He says the agent in charge of the case, Waldo Longa, told Spanakos that the recordings were part of a large-scale fraud investigation and that some of Coriaty’s associates had connections to the New York-based Colombo crime family, possibly referencing the Pate brothers. Attempts to reach Longa through the FBI and through a message left at his home were unsuccessful.
“I still have no idea to this day why they dropped it,” Spanakos said of the agency. “The FBI wanted those tape recordings because they were supposed to be building a case . ... I gave the FBI all of the recordings and hundreds of documents over that period in 2009 to 2010. But I never found out what they used it for or heard back about anything else. They just put up a wall of silence.”
Spanakos said he then went to Detective Mirko Ivanovic of the Palm
Beach Sheriff’s Office in January 2012.
In February 2016, after Spanakos asked Ivanovic for an update on the case, Ivanovic notified him that the FBI had told him it had declined to prosecute the case and that it was closed. Spanakos told the Herald his attorney filed a public records request with the Palm Beach County Sheriff’s Office, but it refused to share anything on the basis that the information contained active criminal intelligence and criminal investigative information.
Informed that Coriaty blames him for his money woes, Spanakos said:
“Why would I do that when I had so much of my own money tied up in the company? It doesn’t make sense. You have all these people coming forward throughout the years, and they’re not saying that I scammed them. They’re saying that Coriaty did.”
In a November 2019 deposition of Ivanovic in the slander suit against Spanakos, the detective testified that his review of Hawk Systems documents and financials convinced him that there was substantial credence to accusations of fraud, and that he would classify the company as a Ponzi scheme.
“That’s the most outrageous part of all of this. As soon as I knew there was fraud going on, I reported it,” Spanakos told the Herald, referring to the feds. “And they did nothing.”
Before hanging up on the Herald, Coriaty acknowledged owing two companies and several people money. Among them: Associated Aircraft Supply. But he added: “If I’m not making any money, how am I responsible for paying him back?”
In response to Coriaty’s assertion, Frazier clarified that his dealing with Coriaty was not a situation in which he had lent Coriaty money or one in which he chose to invest in an illadvised business venture. “I was merely asking for my product in return for the money I paid, and I never got that product,” said Frazier. “If not giving someone the product they paid for but still taking their money isn’t a scam, I don’t know what is.”
In that same Herald interview, Coriaty said he planned to pay back a handful of his accusers, including the Ehrenreichs, within the next 10 days.
That was March 17. The Herald talked to the family after the 27th. No payment had been made.
In his rapid-fire succession of post-interview texts, Coriaty included a one-paragraph note on SEC letterhead stating: “The investigation has been completed as to Hawk Systems, Inc., against whom we do not intend to recommend any enforcement action by the Commission at this.”
At the bottom of the letter dated Aug. 17, 2011, is a difficult-to-decipher signature, under which there is no printed name but the title Associate Regional Director. The Herald determined the signature was that of
Glenn S. Simpson. Contacted at the SEC by a reporter, he refused to address whether the letter was authentic.
“The SEC does not confirm or deny the existence of an investigation,” he texted. “Thus, I do have any comment on the letter about which you are inquiring.”
HARD TIMES MADE HARDER
While the NFL veterans say they could afford to be thrown for a financial loss, Lynda and Larry Pennington could not. Lynda Pennington, 72, worked in retail and was an executive assistant for an engineering consultant firm before retiring, while Larry Pennington, 75, spent 30 years as a sales representative selling cameras and printers for Canon USA.
The Penningtons say they met Coriaty in Orlando through a co-worker in 2006.
“He drove a Lamborghini and a Mercedes and came across as educated and looked like he really didn’t need our money,” Lynda Pennington told the Herald. “It was like he was doing us a favor.”
The couple said Coriaty courted them for months, buying them lunches and entertaining them in his luxury suite at Dolphins games. They said he took him on a tour of a Palm Beach County facility, saying a product either was or would be flying off the assembly line. They were sold. The product wasn’t. Other than a prototype, nothing was manufactured.
“By the time we invested, it felt more like a family proposition than just business,” Larry Pennington said. “And that’s what got us in the end.
You can’t see red flags when you’re looking at everything through rosecolored lenses.”
“We thought we were friends. We went to lunch with him. We went to football games with him,” she added. “It all seemed so real. And then it all went up in smoke.”
“We had a three-bedroom, two-bath house with a pool in Florida. And now we’re living in a trailer park in Pittsburgh. That’s a huge step down from where we were,” Lynda Pennington told the Herald.
“On top of everything, Larry has larynx cancer. He’s doing OK, but having that $80,000 would have made such a huge difference. With all the co-pays and medical bills that are piling up, it could take a huge load off of us.,” she said.
“Looking back at it, I was like, how did we not figure it all out?” Lynda Pennington said.
“But everyone dreams.”