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October 22, 2020

UK millionaire Raheel Choudhary faces fraud probe by Papa John's, HMRC


Thu, Oct 22, 2020
Multimillionaire Pakistani Raheel Choudhary. — Photo provided by author

LONDON: Her Majesty’s Revenue and Customs (HMRC) has confirmed that it is investigating claims of fraud allegedly committed by multimillionaire Pakistani Raheel Choudhary, who is suspected of exploiting the UK government’s Eat Out to Help Out scheme.

The HMRC is also looking at allegations that company fraud was committed by Choudhary, who is a Papa John’s franchisee, over several years without the knowledge of the franchise owner.

The HMRC investigation comes after pizza chain Papa John's said it was investigating serious allegations that taxpayer cash of around £250,000 was fraudulently claimed during the Eat Out to Help Out scheme by Papa John's franchisee Raheel Choudhary, whose family also owns a Papa John’s outlet in Lahore, Pakistan.

A spokesman of HMRC said: "It's our duty to protect taxpayers' money and we will not hesitate to act against those who attempt to break the rules. We have built checks into the Eat Out to Help Out scheme to prevent fraud and protect public money, and will check claims and take appropriate action to withhold or recover payments found to be dishonest or inaccurate. Anyone concerned that an establishment is abusing the scheme can report fraud to HMRC."

A source said that the HMRC is looking extensively at the case after "evidence" was shared about the alleged fraud.

Papa John's GB Ltd has said it was investigating the allegations "thoroughly".

"We will be extremely concerned and disappointed if they prove to be true. All of Papa John's UK stores are run by franchisees and we made it very clear to all franchisees that we felt it unlikely that they would be eligible to participate in Eat Out To Help Out (EOTHO)," a spokesman said.

"It is important that our investigation is completed fully before drawing any conclusions, but if any franchisee participated improperly in EOTHO, they will have been in breach of their franchise agreement with us, and we will require them to make things right."

UK’s The Mail newspaper had broken the story of the alleged fraud after a manager working for Raheel Choudhary contacted the paper with what was described as “video and paper evidence”.

The whistleblower told the paper that Raheel Choudhary had instructed staff to process thousands of fake meals under the scheme across 57 of the 61 branches he owns, resulting in hundreds of thousands of pounds being fraudulently claimed from the government.

In one such incident, 13 orders were allegedly processed in under a minute at the Tunbridge Wells branch, despite staff being told it was forbidden to eat in the store, which has no tables.

The paper claimed that the owner of the stores had given targets to branch managers of £500-£600 per day for stores that had turnovers of under £10,000 per week, and a target of £1,000 a day for bigger branches with a turnover of more than £10,000 per week.

According to the whistleblower’s allegation, Choudhary had instructed his staff to record payments made by "phantom covers" as voucher payments.

Choudhary allegedly made orders to staff to make claims on the Eat Out to Help Out scheme even when Papa John's GB Ltd had clearly told franchisees that they may not be eligible to be participating in the scheme.

Franchisees are bound by agreements that require them to follow all guidelines issued by Papa John's GB Ltd, as well as abiding by and meeting ethical standards and regulatory obligations at all times. Anyone found violating the rules is punished.

Choudhary has denied all the allegations of fraud and said: "We are confident that we were fully compliant with the criteria set by the government."