For his part in one of the country’s largest coronavirus relief schemes, South Florida rapper and reality star Diamond Blue Smith has been charged with fleecing more than $1 million from a federal loan program for struggling businesses and buying a $96,000 Ferrari with the proceeds.

Smith, 36, a cast member on “Love & Hip Hop: Miami” and a member of the group Pretty Ricky, was arrested this week along with a Pennsylvania tow truck operator for their roles in a COVID-19 relief scheme involving $24 million in fraudulent loan applications, authorities said Wednesday.

This summer, a Miami moving man was accused in a similar scam of buying a $318,000 Lamborghini with millions he allegedly bilked from the same Small Business Administration program.

In the latest case, Smith and Tonye C. Johnson, 28, of Pennyslvania, face federal charges of wire fraud, bank fraud, and conspiracy to commit wire fraud and bank fraud in the Southern District of Florida. Smith, who had his first federal court appearance Monday in Atlanta, could not be immediately reached for comment.

Eleven other defendants linked to their case, mostly from Florida, have been charged with conspiring to defraud the Small Business Administration’s Paycheck Protection Program approved by Congress as part of the CARES Act. It is meant to help businesses suffering from the economic downturn caused by the COVID-19 pandemic.

Federal prosecutors allege that Smith, also known as “Baby Blue,” obtained $427,000 in a PPP loan through his company, Throwbackjersey.com, by falsifying documents for the SBA relief program. A bank approved the loan, which is guaranteed by the federal agency. Smith also allegedly obtained another loan of $708,000 through another company, Blue Star Records LLC.

Before his arrest, Smith not only bought the Ferrari but also withdrew about $272,000 in loan proceeds from his bank account, prosecutors said.

The FBI’s investigation revealed that Smith was allegedly part of a broader scheme involving others who helped file applications for the coronavirus relief funds while taking kickbacks. Among the alleged ringleaders: Phillip J. Augustin, 51, of Coral Springs, who is accused of using his talent management company to obtain a fraudulent PPP loan and then collaborating with Smith and several others to submit at least 90 more loans. As a result, the SBA guaranteed a total of $17.4 million in COVID-19 relief loans that were issued to the applicants through local banks extending from Florida to Ohio, authorities said.

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Others charged in the alleged ring include: Former NFL player Joshua J. Bellamy, 31, of St. Petersburg, who was released in September as a wide receiver with the New York Jets. He was charged in Fort Lauderdale federal court with bank and wire fraud.

This summer, the feds made perhaps their biggest headline when investigators arrested a Miami man who bought a $318,000 Lamborghini sports car with $4 million from PPP loans for his moving company. David T. Hines, who was charged with fraud in an isolated case, also spent thousands of dollars on dating websites, jewelry and clothes, along with stays at high-end hotels such as the Fontainebleau and Setai on Miami Beach.

The loans are guaranteed by the SBA under a $650 billion program approved by Congress after the COVID-19 pandemic struck the nation in March. The loans are forgiven by the government as long as the proceeds are used for employee payroll and other legitimate expenses.



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