NEW ORLEANS (WVUE) - A source who was interviewed by Louisiana's inspector general believes the state has enough evidence to charge the owner Horizon Entertainment - a local production company at the center of a FOX 8 probe. We found this firm may have improperly taken advantage of the state's film tax credits - to the tune of about $4.5 million in taxpayer money.
"Who is minding the store here?" wonders Tulane law professor Joel Friedman. "Do you just… 'OK, well I guess, $800,000, OK, pay them. Let 'em have it!'
The state let Horizon have that money as part of Louisiana's film tax credit program.
11 months ago, the state inspector general launched a criminal investigation after our series of stories raised questions about the millions of dollars in tax credits handed over to Horizon, and owner Jason Sciavicco.
Many former Horizon employees told us, both on and off camera, that Horizon claimed millions of dollars in alleged expenses that were never really incurred.
Take Horizon's claim that it spent $100,000 on a jib camera for a reality TV show, based on the Saintsations. Employees say the camera was used just once for the show – at a total cost of $300.
We also had serious questions about payments made to Horizon employees. The company claimed to the state they paid editors and assistant editors about $318,000 for this project.
"If we made that money, we'd probably be driving a Benz right now," one editor, John Beyer, told us when we told him about that the claim.
One source tells us they believe the inspector general's investigation has found wrongdoing. If that's true, the IG's office would bring those findings to state and federal authorities.
But time is running out. Potential crimes like this have what's called statutes of limitations – limits on how much time prosecutors have to build cases and bring charges.
"Most crimes, but not all, have a statute of limitations," Friedman says. "The government can't wait forever to prosecute a guy because witnesses may die over time, or their memories fade, or documents get lost."
These possible crimes occurred about five years ago, in 2011. Federal prosecutors have a five-year period to bring charges, so just a few months remain.
U.S. Attorney Ken Polite wouldn't confirm or deny any investigation, but did tell us his office is "committed to prosecuting any abuses of our state's film tax credit system that constitute violations of federal law."
For charges by the state's attorney general or a district attorney, there's more time. The obvious charge, if wrongdoing occurred, would be theft.
But Friedman says too much time has passed for the state to charge with theft - the prescription period, or statute of limitations, is four years in Louisiana. He tells us prosecutors have more time to charge in money laundering cases.
"But in the Louisiana criminal law, the crime of money laundering is defined very broadly," he says. "Now, it is a separate crime from the theft, right? Money laundering is what you do with the proceeds of the theft."
In Louisiana, money laundering is defined simply: to "receive or acquire proceeds derived from any violation of criminal activity." So, if you commit a crime like theft, and receive the money from that crime, Friedman says, you also laundered money.
And according to Louisiana law, as long as the value of the money laundering is $20,000 or more, the state has six years before the statute of limitations expires.
In the case of Horizon Entertainment, should state prosecutors believe the company committed a crime, they have one more year to bring charges.
"It's too late to prosecute him for theft, but they might very well prosecute him for money laundering," Friedman says.
Sciavicco, Horizon's owner, has left Louisiana. Most recently he worked on a Showtime production in South Bend, Indiana, documenting a season of Notre Dame football.
Notre Dame declined to comment when we asked about Sciavicco's association with the documentary, and whether they were aware of the criminal investigation in Louisiana.
Multiple sources have told us the inspector general's office continues to interview potential witnesses.
If a crime has been committed, Friedman says, state authorities have an obligation to protect the public and their money.