A political consultant who has worked on Democratic South Florida political campaigns allegedly lied on an application for COVID-19 payroll relief, federal prosecutors said on May 9.
The government charged Omar Smith, 42, of Royal Palm Beach, with conspiracy to commit bank fraud and wire fraud in connection with a Paycheck Protection Program loan (PPP).
According to state records, Smith’s business A Star For I was filed as a for-profit corporation in January 2012. Its current status is listed as inactive.
A federal court document filed on May 9 shows in June 2020, Smith had applied for a $212,500 loan intended for A Star for I that says he employed 30 people with a payroll of $85,000.
Prosecutors say that Smith had no employees and no payroll expenses.
A co-conspirator, according to prosecutors, prepared the loan application and subsequently submitted it online.
Smith agreed to pay the co-conspirator 20 percent of the loan amount for helping him apply for the loan, all according to court documents.
Smith received the loan on June 2, 2020, and transferred $42,500 a few days later to the co-conspirator, the court document says.
The co-conspirator is alleged to have prepared an IRS Form 941 for the first quarter of 2019, and “falsely wrote” that Smith’s company paid $255,000 in wages for that quarter and listed taxes withheld and submitted it online as part of the PPP application.
Based on the false information, Smith received the loan on June 2, 2020.
Court documents state that Smith began to write checks between July and October 2020 from his company’s bank account to people and was following conditions of the loan “in order to make it appear as if A Star For I had full-time employees.”
Prosecutors said those people “did little, if any, work” for Smith’s company.
Smith’s attorney Nicole Hamil-Scott, told reporters that the investigation continues and that “any and all funds that they have alleged have been taken were repaid in full” by her client.
Hamil-Scott said Smith had “a legitimate company for which he had employees working with him,” and did not know of anyone else who is being prosecuted in this case and said that the events were “unfortunate.”
“Unfortunate in the sense that … here is a company that … funds were obtained from a loan, funds were paid back and an individual is still being prosecuted, facing a possible prison sentence. So it’s unfortunate from that standpoint,” Hamil-Scott told reporters.
A former client of Smith’s—former Broward mayor and current Democratic candidate for Florida’s 20th Congressional District Dale Holness—told reporters on May 9 that he had no information about the allegations against Smith.
Holness said that Smith “no longer works for him” as he chose to “use other people for the campaign and their entities.”
In January, Damara Holness—the former president of the Broward County Democratic Black Caucus and Holness’ daughter—was sentenced to a year and eight months in prison for “lying on an application” for the same type of loan.
Records show that she applied for a $300,000 loan for her company, Holness Consulting, and said she had a monthly payroll totaling $120,000 with 18 employees.
In a January news release, prosecutors said that once Holness got the money, she issued checks to people who “agreed to help with the fraud for a fee.” And for each check, she was profiting by about $1,000 herself.
Smith, if convicted, could face up to 30 years in prison and may have to pay a fine of up to $1 million, according to prosecutors.
