Siblings made up movie in £1m tax fraud
MIDLAND brothers who tried to steal £1m in a ‘staggering and audaciously dishonest’ film tax fraud have been jailed for a total of 14 years.
One sibling who absconded to Ukraine during the trial was sentenced in his absence.
Craig Rees, 50, and his 52-year-old brother Carl, both from Warwick, submitted fraudulent Film Tax Relief and VAT claims to HM Revenue and Customs (HMRC).
The pair submitted inflated or completely made-up claims to HMRC for three separate films: Whispers, The Eight, and Violence.
In passing sentence Her Honour Judge Heidi Kubik KC, told Birmingham Crown Court the pair were convicted with overwhelming evidence which had revealed “staggering and audacious dishonesty.”
Craig Rees was sentenced in absence this week after absconding during the trial in January.
Judge Kubik said Craig Rees had “ran away in the middle of proceedings” and ordered that when he is apprehended he is produced before her to be sentenced for absconding.
Carl Rees told the court his brother was in Ukraine. The hearing heard that to qualify for Film Tax Relief, at least 25 per cent of the production costs had to relate to activity in the UK at the time they made their claims between 2011 and 2015.
HMRC proved the pair’s claims were fraudulently inflated for the first film, which was moved to the United States. The second film was entirely made up, and the third movie was produced in the US purely to submit further fraudulent claims.
Following a referral from the British Film Institute (BFI), HMRC launched an investigation into the brothers’ claims and unpicked their web of lies, which included fictional expenditure on studios, sound recording and catering.
To present a facade of legitimacy, the pair, set up film production companies which provided forged documents to HMRC for both the FTR and VAT repayment claims.
In total they tried to steal £542,840 in FTR and £484,933 of VAT repayment claims over a four-year period from October 2011.
They received more than £367,000 of the payments. The men were found guilty last month after an 18-week trial at the city court.
Speaking after the case, Mark Robinson, Operational Lead in HMRC’s Fraud Investigation Service, said: “Film Tax Relief is there to help genuine, honest film companies produce brilliant British films, but these brothers thought they could play the system for personal gain.
“We want to ensure there’s a level playing field for those who abide by the law and encourage anyone with information about tax fraud to report it online.”