Developer Eric Sheppard convicted of PPP fraud

Bal Harbour-based developer Eric Sheppard is headed to the slammer, after a jury convicted him of defrauding Covid-19 disaster relief programs. He allegedly stole nearly $900,000 in federal funds between March 2020 and May 2021, according to his indictment. 

Last week, jurors in Miami federal court found the 55-year-old builder guilty of four counts of wire fraud and two counts of aggravated identity theft, court records show. But Sheppard was acquitted on five counts of wire fraud and three counts of aggravated identity theft. His sentencing is set for April, and Sheppard faces up to 82 years in prison. 

Sheppard is not the only South Florida real estate professional headed to prison for allegedly ripping off Covid-19 disaster relief programs. In August, Miami real estate agent Daniela Rendon  was sentenced to three years and five months in federal lock-up, after pleading guilty to defrauding the Small Business Administration and Paycheck Protection Program, known as PPP, out of $381,290. 

Rendon allegedly used the illegally obtained proceeds to lease her white Bentley Bentayga, rent a luxury apartment, refinish her designer shoes and have cosmetic procedures.

During Sheppard’s trial, assistant U.S. attorneys for the Southern District of Florida presented evidence allegedly showing he devised a scheme to fraudulently obtain PPP loans and Economic Injury Disaster Loan funds. 

Sheppard allegedly submitted fraudulent loan applications supported by fabricated documents, including doctored tax returns with the forged signature of his accountant, court records show. 

At the time of his arrest last year, Sheppard headed WSG Development, a firm that was involved in the acquisition, development and construction of commercial and residential projects in 13 states, his LinkedIn profile stated. 

Six entities affiliated with WSG allegedly received the $900,000 in ill-gotten loans through intermediaries, court records show. 

Sheppard’s most significant project occurred shortly before the 2008 real estate crash and global financial crisis. Back then, WSG was redeveloping the historic Carillon Hotel at 6901 Collins Avenue in Miami Beach into Canyon Ranch Hotel & Spa Miami Beach. 

But the project stalled when Sheppard became ensnared in another South Florida scandal. In 2012, WSG and Sheppard settled a federal lawsuit that alleged his development firm diverted nearly $40 million to a company managed by Nevin Shapiro, a then-University of Miami booster who pleaded guilty in 2010 of engineering a $930 million Ponzi scheme. 

The lawsuit alleged that Sheppard, who was a childhood friend of Shapiro, provided loans with no formal documentation to the accused Ponzi schemer’s company. Shapiro allegedly paid back the eight-figure sum directly to Sheppard, which resulted in Sheppard receiving hundreds of thousands of dollars in fees at criminally usurious interest rates, the lawsuit alleged.

Despite maintaining that he was also a Shapiro victim, Sheppard agreed to pay back $700,000. 

Sheppard’s development career cratered in the aftermath of the 2008 crash. In 2009, Lehman Bros. Holdings, an affiliate of the bankrupt Lehman Brothers, took ownership of most of Canyon Ranch’s units through a $301.2 million deed in lieu of foreclosure. A year later, the same Lehman entity foreclosed on a West Palm beach hotel property and development site that were owned by WSG. Sheppard had allegedly defaulted on more than $200 million in loans.
In 2015, Z Capital bought the Canyon Ranch property for $21.6 million out of bankruptcy court, rebranding the project the Carillon Resort & Spa. It is now called the Carillon Miami Wellness resort.