Guilty Verdict Against 3 In Film Tax-Credit Scheme

NEW ORLEANS (AP) — A jury has returned guilty verdicts against three people for their role in a conspiracy to commit mail and wire fraud as part of a film tax-credit scheme.

         U.S. Attorney Kenneth A. Polite says the jury found Peter M. Hoffman, 65, his estranged wife, Susan Hoffman, 69, and attorney Michael P. Arata, 49, guilty Monday of conspiracy to commit fraud in connection with the rehabilitation of a dilapidated mansion that they turned into a film post-production studio.

         Peter Hoffman was convicted of 21 counts of mail and wire fraud related to the deal. He faces up to 405 years in prison. Arata was convicted on seven counts of wire fraud and four counts of making false statements to FBI agents about his involvement in the project. He faces up to 185 years in prison.

         Susan Hoffman was convicted of conspiracy and one count of mail fraud. She faces 45 years in prison.

         Sentencing dates were not set.

         Jurors deliberated for about 10 hours over two days, after hearing two weeks of trial testimony.

         The law at the heart of the case allows movie production companies to get a tax credit — at the time of the alleged crime it was up to 40 percent — for certain infrastructure costs, defined as the "purchase, construction and use of facilities that were directly related to and utilized for motion picture production in Louisiana."

         If tax credits earned exceed the business's actual tax liability, the credits can be sold to another party that wants to use the credit to pay off its liabilities.

         Federal authorities say the Hoffmans and Arata, through companies they owned, purchased the mansion just outside the French Quarter in 2007, with plans to turn it into a post-production facility. The alleged crime was using fraudulent documents to obtain tax credits for work that was not actually done on the renovated mansion, credits that Arata purchased at a discount from his partners, then sold at a profit to local businesses and people.




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