Brothers jailed after £1m film tax fraud

Carl and Craig Rees

Two brothers have been jailed for 14 years after attempting to steal £1m by committing film tax fraud.

Craig Rees, 50, and his 52-year-old brother Carl from Warwickshire submitted inflated or completely made-up Film Tax Relief (FTR) claims and VAT claims to HMRC for three separate films: Whispers, The Eight, and Violence.

To qualify for Film Tax Relief, at least 25% of 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.

In passing sentence, Her Honour Judge Heidi Kubik KC said the pair were convicted with evidence which had revealed “staggering and audacious dishonesty.”

Craig Rees was sentenced in absence at Birmingham Crown Court today (April 8), after absconding during the trial in January 2024. His brother Carl claims that Craig is in Ukraine.

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 any type of tax fraud to report it online.”

Following a referral from the British Film Institute (BFI), HMRC launched an investigation into the brothers’ claims which found fictional expenditure on studios, sound recording and catering.

To present a façade of legitimacy, the duo 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. In total, they received more than £367,000 of the payments.

The men were found guilty after an 18-week trial at Birmingham Crown Court.