Philly campaign consultant Tracy Hardy pleads guilty to $2M pandemic loan fraud, union hall scheme

Tracy Hardy, a Philadelphia campaign consultant, pleaded guilty Thursday to three counts of wire fraud and one count of making a false claim to the U.S. government.

Hardy, 52, a longtime Philadelphia political operative who previously worked as an aide to former Mayor John F. Street and as chief of staff to State Sen. Sharif Street (D., Philadelphia), fraudulently inflated his business’ finances to obtain pandemic relief funds of about $2 million and created a fake bidding process for a bar renovation scheme for a Philadelphia union hall.

He requested more than $2 million in fraudulent pandemic relief loans, and received more than $1.9 million. In a separate scheme, he fraudulently inflated the price of a District 1199C union hall renovation job by $45,000 by making up fake competing bids.

Hardy said in a text message to his “corrupt accountant” that he was “trying to obtain generational wealth for family and really wanted to get these loans,” Louis Lappen, assistant U.S. attorney, said in court on Thursday.

But Hardy went on to spend the money on cars, travel, and sports tickets, and transferred money to other companies — all inconsistent with how COVID-19 relief funds were supposed to be used.

During the economic crisis of the COVID-19 pandemic, the federal government’s Paycheck Protection Program (PPP) provided hundreds of billions of dollars in emergency funds in the form of forgivable loans to small businesses for expenses like job retention. Additionally, the Small Business Administration provided small businesses with working capital loans through the Economic Injury Disaster Loan (EIDL) program.

Hardy took advantage of both programs by inflating the finances of three of his companies: Lou & Choo’s Lounge, Hardy & Hardy, and Monroe Press. He lied about the number of employees his companies had, the wages he paid, and his sales numbers to qualify for the loans

He paid an inflated price tag for what prosecutors said is a corrupt financial services company that submitted fraudulent applications for him, and he lied about the purpose of those payments on checks to try to hide the scheme. He also used names of family members involved in his companies in some of his applications to try to conceal his fraud.

Hardy applied for four PPP loans and received three of them — two for Lou & Choo’s Lounge, a bar in the Nicetown-Hunting Park neighborhood, and one for Monroe Press. He was denied one for Hardy & Hardy, a real estate holding company that does not have any employees, wages, or revenue, the prosecutor said. He also received a $1.4 million EIDL loan for Lou & Choo’s after initially being rejected for not meeting revenue requirements. The four loans he received totaled more than $1.9 million.

He also pleaded guilty on Thursday to his role in a scheme in which he created fake bids for a union hall bar renovation job in Manayunk for District 1199C, a local chapter of the National Union of Hospital and Healthcare Employees. This made it seem like his construction company, Manayunk Construction & Development Corp., offered the best price for the job even though he inflated the price by $45,000.

As part of the federal court agreement, the Pennsylvania Attorney General’s Office will drop state charges against Hardy related to the union hall matter, so his codefendant, Christen Woods, the former head of District 1199C, is expected to be charged alone.

Lappen, the assistant U.S. attorney, declined to comment, saying a “proceeding like this speaks for itself.” Hardy, his wife, Jennifer Gomez-Hardy, and his attorney, Brian McMonagle, all declined to comment.