Ex-councillor jailed over £430k Eat Out to Help Out fraud

Mohammed Ikram made 19 fraudulent claims under then-Chancellor Rishi Sunak’s initiative over four weeks in August and September 2020.

The case is the first conviction for Covid scheme fraud by HM Revenue and Custom (HMRC).

The Treasury-backed scheme allowed food businesses to offer customers a 50% discount in a bid to encourage them to return to the struggling hospitality sector once Covid-19 restrictions were relaxed.

Ikram, 36, made 19 fake claims totalling £434,073 through the scheme for eight different food outlets, Bradford Crown Court heard.

Six of the businesses were either “entirely fictitious” or legitimate companies he had no connection with, prosecutor Timothy Jacobs said.

Two were food outlets he had some link with, but not a “current one”, the court heard.

Ikram was also a member of Keighley Town Council until his resignation in 2022, HMRC said.

Mr Jacobs told the court that eight of the 19 claims were paid by the Government, with just over £189,000 being paid into bank accounts held by Ikram’s wife. The other 11 claims were rejected.

More than half the money paid out has been recovered by HMRC, but just under £93,000 is outstanding, the court was told.

The Eat Out to Help Out initiative enabled restaurants, cafes, pubs and other food outlets to offer customers a 50% discount, up to £10, and obtain a reimbursement from HMRC for the same amount.

Mr Jacobs said Ikram registered with the scheme and used his own name and telephone number for each of his claims, with the IP address used later traced to his home in Springfield Court, Keighley, West Yorkshire.

Thirteen of the claims related to either fake food outlets or real ones Ikram had no link with, including one address that was actually a barbers’ shop, one that was a hotel that had closed down, and a community cafe that operated only every third Sunday, the court was told.

Mr Jacobs said five of the claims related to Khan’s Cafe, which Ikram had been associated with up until March 2020, “but his involvement had ceased by the time the claims were made”.

The defendant and his wife were arrested on June 16 2021 after an investigation by HMRC’s Taxpayer Protection Taskforce. The case against his wife was later dropped.

Nick Worsley, mitigating, said Ikram had racked up debts of more than £75,000 in relation to “running a care home in Manchester” and “stupidly” saw the Eat Out to Help Out scheme “as a way of solving his immediate financial difficulties”.

He told the court Ikram was “a man of good character who has contributed much to the community in a very positive way” and the offending was “an aberration”.

Ikram admitted cheating the public revenue, fraud by false representation and associated money laundering at a hearing last June, and was jailed on Friday for two years and six months.

Deputy Circuit Judge Timothy Clayson told him: “Even if I accept your assertion that some of this money was obtained with a view to covering financial obligations, given the sums involved it’s apparent the vast majority of this was motivated by greed.”

Simon York, director, fraud investigation service, HMRC, said: “This was a blatant fraud by somebody who held a position of trust and responsibility.

“These schemes were designed to support individuals and businesses during a terribly difficult period. Instead, Mohammed Ikram stole money which should have been paying for vital public services and helping those who needed it most.

“This is the first conviction of Covid scheme fraud by HMRC, but we have arrested 70 people and have a number of cases working their way through the criminal justice system.

“So far, we have prevented the payment of, or recovered more than £1.2 billion, with compliance activity still ongoing.”