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Hotel owner jailed for fraudulent Eat Out to Help Out claims

|News, Fraud and economic crime

A hotel owner has been jailed for fraudulently claiming thousands of pounds from Government schemes to help businesses survive the Covid crisis.

Shahid Naseeb Ahmed, 42, tried to falsely claim around £138,840 from the Government’s Eat Out To Help Out Scheme (EOTHO) and the Coronavirus Job Retention Scheme (CJRS).

His claims were for the Merchants Hotel in Back Piccadilly in Manchester, between April 2020 and August 2021. He was the sole director of the hotel at the time of the claims.

Under the EOTHO scheme he falsely claimed £61,165 and from the CJRS he falsely claimed £51,708. Further false claims were stopped when HMRC became suspicious.

The EOTHO scheme incentivised people to eat in restaurants and cafes by giving them a discount which the restaurateur could then claim back from the Government. It was designed to revitalise the catering industry which had been hit by the Covid lockdown.

The CJRS was created to support UK employers and employees who could not maintain their current workforce because their operations were affected by the Coronavirus pandemic.

Operation Egon was an investigation by HMRC into fraudulent claims made from the schemes.

Investigators discovered that Ahmed did not serve food in his hotel at all. The only “catering” was tea and coffee-making facilities in the hotel bedrooms. Yet he claimed for thousands of diners in the investigation period.

Ahmed also “doubled up” his claims by claiming for two separate hotels -  Merchants Hotel Ltd and Merchants MCR – when in fact there was only one hotel.

Under the CJRS he fraudulently claimed for full-time staff who were part-time and said they were paid more than they were. He also claimed the hotel had remained closed for the period of the claims when, in fact, it had reopened for part of the period.

Enquiries with a number of banks confirmed that Ahmed was the sole recipient of the monies wrongly paid.

He was arrested on 20 October 2021 and taken to Bury Police Station. He confirmed he was the sole director of the Merchants Hotel and that he has owned it since 2006. He admitted overclaiming on the Job Retention Scheme and that his claims on the Eat Out to Help Scheme were “completely fabricated”.

On 1 August 2023 at Manchester Crown Court, Ahmed pleaded guilty to 25 counts of fraud. Seven other counts were allowed to lie on file. Today (9 November 2023) at Manchester Crown Court he was jailed for 40 months.

Senior Crown Court Prosecutor Maqsood Khan, of CPS Mersey Cheshire’s Fraud Unit, said, “Shahid Ahmed cynically took advantage of two Government schemes designed to help businesses survive a national crisis.

“He submitted fraudulent claim after fraudulent claim over many months – his fraud was systematic, deliberate and planned. He tried several ways to get as much money as he could.

“There are lots of demands on the public purse and these schemes were designed to help genuine claimants. People like Shahid Ahmed undermine the system and take money that is badly needed elsewhere.”

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