A gang found guilty of making a film solely as a £2.8m tax scam have been sentenced in the first prosecution for film tax relief fraud at Southwark Crown Court.
HMRC investigators found that the film, A Landscape of Lives, which it was claimed starred Hollywood A-list actors, was never intended for the big screen and was a sham production. The real intent was to defraud the public purse of nearly £1.5m in VAT along with nearly £1.3m in film tax credit claims.
Gang leader Bashar Al-Issa, 35, of Maida Vale, London, along with Aoife Madden, of Northern Ireland, Tariq Hassan, of Essex, Ian Sherwood and Osama Al Baghdady, both of Manchester, owned Evolved Pictures.
Al-Issa was convicted on 12 March 2013 of two counts of conspiracy to cheat the public revenue, and sentenced to six years five months at Southwark Crown Court. Madden was given four years, eight months and was convicted of conspiracy.
Al Baghdady was convicted on 12 March 2013 of one counts of conspiracy to cheat the public revenue and sentenced to 4 years at Southwark Crown Court.
Evolved Pictures told HMRC that millions of pounds of work had been spent on the film, including paying actors and film set managers, claiming this meant a VAT repayment was due of £1,488,187.
However, during checks HMRC found that the work had not been done and most of the so-called suppliers and film studios had never heard of the gang.
By capitalising on a scheme designed to support British film makers, Evolved made fraudulent tax credit claims of £256,385.50, while preparing to submit a further claim of £1,033,337.
After they were arrested, the gang came up with an elaborate plan to cover their tracks and hide the fraud by shooting a film on a shoestring, called A Landscape of Lies, featuring two television personalities.
John Pointing, assistant director of criminal investigation at HMRC, said: 'This gang thought they could exploit rules for genuine British filmmakers and thieve from the public purse for their own gain. They were wrong.'
The gang was found guilty on 12 March 2013. Confiscation proceedings are underway.