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$50 Million Scheme Exposed
A federal grand jury has indicted a Maryland couple on charges of defrauding the Small Business Administration’s (SBA) disadvantaged small business program and filing false tax returns. Vernon J. Smith III, 61, and his wife Georgia Smith, 52, both of Edgewater, Maryland, face numerous counts of fraud and tax evasion.
According to the indictment, the couple allegedly conspired to defraud the SBA by concealing that Vernon J. Smith controlled Platinum One Contracting, a roofing and construction company that participated in the SBA’s Section 8(a) program. The program provides assistance to socially and economically disadvantaged small businesses, including help in obtaining federal contracts.
The indictment alleges that from August 1999 to June 2013, Vernon J. Smith III and Georgia Smith conspired to defraud the SBA by concealing that Vernon J. Smith controlled Platinum One’s operations, not Anthony Wright, who was listed as the owner. As a result, the SBA approved Platinum One for participation in the Section 8(a) program, and the company received more than $50 million in contracts from the federal government.
The indictment also alleges that the Smiths caused more than $1 million in payments to be made to themselves and Capitol Contractors, another company owned by Vernon J. Smith. These payments included salary, payments to Capitol Contractors, and personal charges by the Smiths to Platinum One’s credit cards.
“The 8(a) Business Development Program offers significant benefits to eligible small businesses and helps small, disadvantaged businesses compete in the marketplace,” said Inspector General Peggy E. Gustafson of the Small Business Administration. “Preferences for federal contract awards must not be given to persons who lie in order to claim eligibility.”
The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein, Small Business Administration Inspector General Peggy E. Gustafson, and other law enforcement officials. The case is being prosecuted by the U.S. Attorney’s Office for the District of Maryland.
The Smiths are scheduled to appear in court on [insert date] to face the charges. If convicted, they could face significant prison time and fines.
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Key Facts
- State: Maryland
- Category: Fraud & Financial Crimes|White Collar Crime
- Source: DOJ Press Release ↗
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