As with other gyms and exercise venues across Charlotte, Surge Fitness has been closed under a state order to control the spread of COVID-19.
Now the question becomes whether the Park Road fitness studio will ever reopen.
Last week, its owner, Dino Crnalic of Charlotte, was indicted on a series of financial fraud charges related both to Surge and Crnalic’s short-lived sushi restaurant, Suki Akor, on Martin Luther King Boulevard.
According to prosecutors and newly unsealed court documents, Crnalic, 33, is accused of illegally acquiring more than $800,000 in loans backed by the Small Business Administration to open both places.
He has been charged with financial institution fraud, aggravated identity theft, money laundering, wire fraud and making a false statement to a bank to get a loan.
Add all the maximum penalties up and Crnalic faces decades in prison and millions of dollars in fines. The government also says it will try to recover $845,000, the amount Crnalic collected in his scheme, according to the indictment.
Starting in 2016, Crnalic lied on loan requests, ran up bills using the stolen identity of an erstwhile partner and walked away from hundreds of thousands of dollars in debt, prosecutors say. He pocketed a portion of his loan proceeds to pay rent on an uptown apartment, take gambling trips to Las Vegas and New Orleans casinos, and make payments on a luxury car. He ate and drank well, too.
Suki Akor opened beneath Embassy Suites in March 2018. The Observer had listed it at the top of the year’s most anticipated additions to the uptown restaurant scene.
It closed within two months.
By then, according to his indictment, Crnalic had run up hundreds of thousands of dollars in unpaid obligations, not to mention defaulting on the taxpayer-backed loans.
Crnalic quickly swapped business plans — from fish to fitness.
In the fall of 2018, he began fraudulently amassing capital for Surge, prosecutors allege. He went after a $250,000 loan from another bank with the help of false statements, phony documents and claims of a non-existent business partnership with a individual identified in court documents as C.P., the indictment shows.
When the bank started asking more questions, Crnalic dropped his loan request. Instead, according to prosecutors, he used C.P.’s identity to finance some $50,000 in exercise equipment for his new fitness club. Crnalic defaulted on that loan, too.
Surge opened in January. It remains closed under the state’s pandemic order.
Crnalic made his initial appearance in federal court Friday morning before U.S. Magistrate Judge David Cayer. He was allowed to self-surrender at the federal courthouse and was freed on $25,000 bond.
His attorney, Ed Hinson of Charlotte, said Crnalic will enter a not guilty plea and “looks forward to presenting his side of this in court.”
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