Pretty Ricky Rapper Surrenders In PPP Loan Fraud Spree at Hard Rock Hollywood

Posted on: February 2, 2022, 02:37h. 

Last updated on: February 3, 2022, 09:17h.

Philip Conneller @casinoorgphilc Read More
Expertise: Gaming Business, Regulation, Tribal Gaming.

Baby Blue, a rapper with Florida-based hip-hop/R&B group Pretty Ricky, is turning himself in to the feds.

Baby Blue
Baby Blue, aka Diamond Blue Smith, claims he has learned from his $1.1 million fraudulent PPP claims and will come back “more wiser” and “more stronger.” (Image: Audible Treats)

The Miramar-based recording artist told his social media followers that on Monday, he will begin a 20-month sentence for his role in a $35 million COVID-19 relief fraud scheme.

The 37-year-old, real name Diamond Blue Smith, was not the biggest player in the scheme. But in August, he pleaded guilty to one count of wire fraud related to Paycheck Protection Program (PPP) loans he claimed for two companies he owns, totaling more than $1.1 million.

Smith admitted using the funds as his personal expenses, spending much of the money at the Seminole Hard Rock Hollywood. He also splurged on luxury items, including a Ferrari for $96,000.

He confessed to paying more than $250,000 of the money to James Stote of Hollywood, FL and Phillip Augustin of Coral Springs, FL as a commission for preparing and submitting the fraudulent applications and creating false documentation.

$35M Scheme

In December, Stote and Augustin pleaded guilty in a court in Ohio to submit at least 79 fraudulent PPP applications for themselves and 25 associates, including Smith. According to prosecutors, the scheme relied on fake payroll numbers, falsified IRS forms, and phony bank statements.

At the time of their arrest, they were planning more applications.

The pair are yet to be sentenced and could face up to 20 years in prison. Smith has been ordered to pay $1,111,345.23 in restitution, plus $1,134,782 in forfeiture. Federal agents have already seized his Ferrari.

“While many businesses in our communities relied upon relief funds to keep their doors open and employees paid, these defendants profited off a scheme that stole millions of taxpayer dollars intended for struggling businesses and spent it lavishly on themselves,” said First Assistant US Attorney Michelle M. Baeppler for the Northern District of Ohio.

“Theft of government funds will not be tolerated, and prosecuting PPP fraud remains a priority for law enforcement,” she added.

Smith’s Apologies to Fans

Smith, whose group had hits in the 2000s with Grind with Me and Your Body, told followers on Instagram he had “made a mistake.”

I’ve learned from it the hard way and won’t make it again,” he wrote. “My mistakes don’t define me as a man, and I will come out of this more than I was before, with more integrity, more character, more knowledge of myself, more [sic] wiser, more [sic] stronger!” he claimed.

“Turning myself in to the Feds on Monday, February 7th. If you wanna write me or send me anything, see info below…” he added, before listing the address of FCI Coleman Low, a federal Correctional Institution.