A Nashville social club owner on Wednesday pleaded guilty to a campaign finance scheme that also involves a Tennessee state senator's failed 2016 congressional campaign.
Joshua Smith, 45, pleaded guilty to aiding and abetting the solicitation and spending of at least $25,000 of so-called “soft money” — or funds not subject to federal limitations and reporting requirements — in connection with a federal election.
The plea comes three months before state Sen. Brian Kelsey, a Republican, is scheduled to head to trial after pleading not guilty to federal campaign fraud charges. Kelsey, who is not seeking reelection this year, has criticized the charges as a “political witch hunt.”
Smith's attorneys notified a federal judge earlier this month that a plea deal had been reached with prosecutors.
Smith did not offer any comment during Wednesday's hearing other than to confirm to the judge that he understood and agreed to the plea deal. His sentencing hearing will be June 9, 2023, where the maximum penalty is five years in prison.
A five-count indictment filed in October 2021 alleges that Smith, owner of The Standard club, and Kelsey violated campaign finance laws by illegally concealing the transfer of $91,000 during the lawmaker’s congressional campaign in 2016.
The Standard is a restaurant and private club near the state Capitol that is often frequented by lawmakers and has featured its own political action committee.
Kelsey and Smith “unlawfully and secretly” funneled funds from Kelsey’s state Senate campaign committee to his federal congressional campaign committee, according to the indictment.
Prosecutors also allege that Kelsey and others caused a national nonprofit political organization to make illegal and excessive campaign contributions to Kelsey by coordinating with the organization on advertisements, and they caused the organization to file false reports to the Federal Election Commission.
The indictment mentions, but does not charge, two alleged co-conspirators, one of whom is described as an attorney and former Tennessee House member expelled in 2016. Former Rep. Jeremy Durham, a Republican attorney from Franklin, was the only lawmaker expelled that year.
