Mark Smith, former head of state film office, sentenced to 24 months after taking bribes for tax credits

From The Times-Picayune

by Laura Maggi
Mark Smith, the former lead recruiter responsible for recruiting movie companies to make films in Louisiana, will serve a two-year prison term for accepting bribes in exchange for giving lucrative state tax credits to a film producer, a federal judge ruled today.

U.S. District Judge Kurt Engelhardt told Smith that he believed he was "sincerely remorseful," but said that his actions had tarnished the fledgling movie industry. "We live with the damage today," the judge said, as he put the finishing touches on two-year investigation of how the state awarded benefits to the companies that finance entertainment productions in the state.

Engelhardt said in determining the two-year prison sentence, much less than time Smith could have gotten, he balanced Smith's cooperation with federal investigators after his guilty plea in the fall of 2007 against the damage he wrought by accepting cash bribes from a film producer in exchange for doling out too many lucrative state tax credits.

That cooperation led to others being charged in the case: Malcolm Petal, the co-founder and head of the New Orleans company LIFT Productions and other firms and William Bradley, a Hammond attorney. Both men also pleaded guilty to participating in a conspiracy to bribe a state official.

The bribes, worth $135,000, were channeled from Petal to Bradley, a former law-school friend of Smith, who then split the money with Smith. Engelhardt ordered Smith to pay a $67,5000 fine, saying he couldn't allow him to keep the ill-gotten gains.

"The sentence is fair and justified," Smith told the judge at the end of the proceedings. He was ordered to report to prison on August 31.

As the state's film commissioner, Smith had the authority to determine how many tax credits to award to productions filmed in Louisiana. Federal prosecutors have said he gave "way more" tax credits to Petal than he deserved based on how much money he actually spent.

The credits were valuable because upon receipt producers could sell them at a slight discount, meaning that they generated instant cash.

The focus of the investigation was $1.35 million in tax credits received by one of Petal's companies, Break Beat, for filming the 2003 Voodoo Music Festival.

The sentencing today brings the case to a close. Bradley was sentenced to 10 months in federal prison by U.S. District Judge Lance Africk earlier this month. Petal received the stiffest sentence, a five-year prison term also handed down by Africk.

Africk said at the time that he gave Petal the maximum sentence because his actions bolstered the state's reputation for rampant political corruption at a time when residents are striving to shed that image.