Royal Palm political consultant admits he lied to get $212K Paycheck Protection Program loan
A 42-year-old Royal Palm Beach man, who served as a political advisor to Congressional candidate Dale Holness, faces a maximum 30-year prison term and a $1 million fine after admitting he lied to get a loan designed to help businesses survive the COVID-19 pandemic.
Omar Smith pleaded guilty in federal court last week to conspiracy to commit wire and bank fraud. U.S. Magistrate Judge Bruce Reinhart didn't set a sentencing date.
The guilty plea came two months after FBI agents arrested Smith, claiming he submitted a phony application to get a $212,500 loan through the federal Paycheck Protection Program. The relief program was created during the height of the pandemic so businesses could continue to pay workers while their doors were closed.
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In a June 2020 application, Smith claimed his company, A Star for I, employed 30 people and had a monthly payroll of $85,000, agents said in court papers. Instead, agents said, no one worked for the firm.
Smith also paid an unidentified co-conspirator 20% of the loan amount to help him get the money. After the loan was approved, he sent the co-conspirator $42,500, court records show.
To cover his tracks, Smith also sent some of the loan proceeds to people who agreed to pretend they worked for him so the loan would look legitimate, agents said.
After questioning those involved, FBI agents said the entire loan, plus interest, was returned.
Worked on candidate's campaign to replace late U.S. Rep. Alcee Hastings
Campaign records show Smith was a paid consultant to Holness, a former Broward County commissioner who in January narrowly lost his bid to replace the late U.S. Rep. Alcee Hastings.
Holness, who is again campaigning for the District 20 seat, said he isn't the only candidate who used Smith.
"Omar Smith was a paid political consultant on other campaigns," Holness said through a spokesperson.
The district spans the western reaches of Broward and Palm Beach counties, including parts of Fort Lauderdale and West Palm Beach. The Democratic primary is Aug. 23.
Holness' daughter, Damara, last year pleaded guilty to lying on a PPP application to get $300,000. She falsely claimed she employed 18 people. She was sentenced to nearly two years in prison.
Jane Musgrave covers federal and civil courts and occasionally ventures into criminal trials in state court. Contact her at jmusgrave@pbpost.com.
This article originally appeared on Palm Beach Post: Paycheck Protection loan scam may send political consultant to prison
