19/03/2013 - Potential £2.8 million scam prevented by investigators

A gang who made a film as a £2.8 million tax scam have been convicted in the first prosecution for film tax relief fraud. Her Majesty’s Revenue and Customs (HMRC) investigators found that the film, A Landscape of Lies, apparently starring Hollywood A-listers, was never intended for the big screen and was a sham. The real intent was to defraud the public purse of nearly £1.5 million in Value Added Tax (VAT) along with nearly £1.3 million in film tax credit claims.

Bashar Al-Issa, Aoife Madden, Tariq Hassan, Ian Sherwood and Osama Al Baghdady of Evolved Pictures told auditors that they had a budget of £19 million provided by a Jordanian company to produce a blockbuster film in the UK. Evolved told HMRC that millions had been spent on the film, claiming this meant a VAT repayment was due of £1,488,187. However, HMRC found that the work had not been done and most of the suppliers and film studios had never heard of Evolved and that the company made fraudulent tax credit claims of £256,385.50, while preparing to submit a further claim of £1,033,337. 

Faced with the truth, the gang tried to hide the fraud by shooting a film titled A Landscape Of Lies on a budget of £750,000, directed by Paul Knight. 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. Falsely claiming VAT that is not due is illegal - so we are pleased that instead of this film flop going straight to DVD, these small-screen z-listers could go straight to jail.

Ironically, the film won the Silver Ace award at the Las Vegas Film Festival in 2012.