By Kevin Deutsch
A political consultant who worked on local campaigns, including former Broward County Mayor Dale Holness, is facing federal prison time for defrauding a bank to obtain COVID-19 loan money.
According to federal prosecutors, Omar Smith, 42, of Royal Palm Beach, lied on a coronavirus relief loan application and fraudulently obtained more than $200,000 intended to help small businesses survive the pandemic.
The criminality began in June 2020, when Smith applied for a $212,500 forgivable, federally-guaranteed Paycheck Protection Program loan on behalf of A Star For I, Inc., a Florida company he owned, prosecutors said.
According to court papers filed Monday in federal district court in Fort Lauderdale, Smith justified the online loan request by claiming his company employed 30 people and spent an average of $85,000 a month on payroll. In fact, the records show that Smith’s company employed zero workers and had no payroll expenses.
To fool lenders, Smith allegedly submitted fraudulent payroll tax forms with his loan application, prosecutors said.
The chicanery worked: A bank in Utah approved A Star For I’s PPP loan application based on Smith’s lies and wired $212,500 to the company’s bank account in Florida in July 2020, prosecutors said.
Money in hand, Smith spent the next few months creating a paper trail to make it appear his company employed workers and was legitimately spending PPP money, records show.
According to the charging documents, Smith issued checks from the company bank account made out to others who did little or no work for A Star For I.
Smith is charged with conspiring to commit bank fraud and wire fraud. If convicted, he faces up to 30 years in prison and a fine of up to $1 million.
Campaign finance records show Dale Holness made several payments to Smith and his companies for consulting and related work spanning 2019 to 2021.
Holness’ daughter, Damara Holness, was also involved in COVID loan fraud.
In January, a judge sentenced her to 20 months in federal prison for lying on a coronavirus relief loan application and fraudulently obtaining hundreds of thousands of dollars intended to help small businesses, authorities said.
The 28-year-old, who pleaded guilty in November, will also serve five years of supervised release after completing her prison sentence, according to the U.S. Attorney’s Office in Florida’s Southern District.
Dale Holness, who represented part of Tamarac as a Broward County commissioner, lost the Nov. 2 special Democratic primary to newly elected U.S. Representative Sheila Cherfilus-McCormick by just five votes.
He has filed papers to run for the seat again in this year’s regular congressional election.
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