Man pleads guilty in film tax credit scam that cost taxpayers $1.2 million
BATON ROUGE - The Department of Justice reported a man accused in a motion picture tax credit scam and costing Louisiana taxpayers $1.2 million pleaded guilty on Tuesday.
38-year-old Matthew Keith was sentenced to six months in federal prison and ordered to pay $1,200,000 in restitution to the state.
Keith previously pleaded guilty to one count of conspiracy to commit wire fraud in connection with a scheme to defraud the state’s Motion Picture Industry Development Tax Credit Program, also known simply as “Tax Credit Program.”
In his guilty plea, Keith admitted that owned and operated Dirty District Entertainment, LLC, which provided technical services for production companies of motion pictures. He admitted that he conspired with at least one other person to present falsely inflated expenditures to the state in application for film tax credits.
The DoJ says that between June 10, 2009 and March, 31, 2010, a co-conspirator of Keith’s applied for and received tax credits from the Louisiana Economic Development Office for the production of various movies. The LED is a state entity with the mission to lead economic development within Louisiana. LED operated the Tax Credit Program, which was designed to draw film production companies to shoot films and other video productions in the the state.
The Tax Credit Program provided a 30 percent tax credit on qualified expenditures for the production of films in Louisiana. Once issue by LED, the tax credits were fully transferable. However, Keith admitted to investigators that he conspired with at least one other individual to make a series of financial transfers, later used to falsely reflect some $4 million of expenditures that had supposedly been incurred in the production of motion pictures. These false expenditures allowed Keith’s co-conspirator to be awarded the tax credits, and Keith admitted that his partner in crime was not entitled to the $1,200,000 of the tax credits he did receive.
The investigation into the scam was carried out by the FBI and the state Inspector General’s Office with prosecution conducted by the Department of Justice.