NEW ORLEANS (AP) — A New Orleans attorney was spared prison Wednesday for fraud involving the generous tax credit program credited with turning Louisiana into "Hollywood South."
A federal judge sentenced Michael Arata to probation and a $15,000 fine. Arata was one of three people convicted last April in what prosecutors said was a scheme to get $1 million in state tax credits for a project that turned a dilapidated mansion into a film production facility. The other two defendants, husband-and-wife film producers Peter and Susan Hoffman, await sentencing.
Authorities said the three used fraudulent documents to obtain credits for work that was not actually done.
Defense lawyers are appealing the verdict. They have pointed to the fact that the renovation was completed, the production facility is operating and that even a financial firm cast as a victim in the scheme has since written a letter to the court stating that it did not consider itself a victim.
U.S. District Judge Martin Feldman noted the complicated nature of the case and the regulation of the tax credit program. He said there is some doubt as to whether there was any victim in the case. He said the state, shortly before sentencing submitted a letter claiming to be a victim of fraud, but, he said, the state never sought a return of the tax credits.
Feldman threw out many of the convictions against Arata and Peter Hoffman in a lengthy December opinion. He declined to grant a new trial for any of the three defendants at the time, saying it wasn't appropriate "simply because the court disagrees with the jury's verdict or because the court would have resolved the case differently."
Feldman was highly critical of prosecutors' tactics in that December ruling. And, he made his dissatisfaction known again Wednesday. "Unchecked prosecutorial zeal deals a body blow to the Constitution," he said.
He also noted numerous written character references for Arata. And he allowed a Catholic priest, the Rev. William Maestri, to make a statement in court about Arata's charitable works.
In addition to appeals and the Hoffmans' sentencing, a hearing is set for March 30 on a government motion to have the defendants forfeit more than $1.1 million.
– by AP Reporter Kevin McGill
