Filmmaker acquitted on fraud charge in tax credit scandal

A Nebraska filmmaker who's spent more than seven years and three trials fighting felony charges stemming from the Iowa Film Office tax credit scandal was acquitted by jurors on Thursday of fraudulent practice. 

The "not guilty" verdict caps a criminal case against Dennis Brouse, who produced and starred in a television show about horse training for public television, that was sent back to a district court twice by judges on the Iowa Court of Appeals for new trials due to issues with evidence and a faulty jury instruction.

Brouse stands cleared of all the charges he once faced and Assistant Iowa Attorney General Rob Sand said that there are no more active investigations focused on the filmmaker. 

Brouse, 66, moved his Changing Horses Productions company to Iowa to take advantage of a generous tax credit program established by legislators in 2007 to lure filmmakers to the state. The credits were shut down in 2009 when officials realized that slapdash oversight had made the program vulnerable to exploitation. A probe by the state auditor's office ultimately found that $26 million of the $32 million handed out in tax credits were wrongly awarded. 

Brouse has faced multiple charges since 2011 stemming from the tax credit scandal, focusing in part on the purchase he made of a 38-foot camper from Shirley and Wayne Weese, a Prole couple. Prosecutors alleged that Brouse paid the couple $10,500 for the camper but reported it as a $22,500 purchase to the film office for tax credit purposes. 

But defense attorney Angela Campbell said Thursday that the attorney general's office was "overreaching" in bringing the charges against Brouse. The $22,500 purchase price that was reported to the film office also included $12,000 in advertising for the Weese's restaurant that Brouse ran on his show, "Saddle Up With Dennis Brouse," Campbell argued.   

“Obviously we are pleased that this ends it for Dennis," Campbell said. "It’s disappointing that it took this long and the state continued to press this in the face of what we thought was pretty strong evidence that Dennis wasn’t committing fraud. This has ruined his life basically for the last seven years, so he’s finally able to go back to training horses like he always wanted to.”

Jurors at his first trial in 2012 rejected arguments from prosecutors that Brouse illegally used the tax credit program to enrich himself, but they convicted him of fraudulent practice. A judge sentenced Brouse to serve 10 years in prison, but the court of appeals overturned the verdict due to an unclear jury instruction.

Brouse was convicted again in 2015 of fraudulent practice and sentenced to probation, but judges on the court of appeals vacated the conviction again because of evidence that tainted the trial. In that ruling, Judge Michael Mullins wrote that Sand should not have introduced evidence of Brouse personally benefiting from credits valued at $884,154 because it was not relevant to the narrow issue involving the camper.   

Brouse and his attorneys have long maintained that his use of the tax credits was transparent and that he trusted his tax broker, Chad Witter, who was also acquitted of fraud charges stemming from the scandal. 

Sand had no comment on Thursday about the final trial, which began on Monday at the Polk County Courthouse. 

"As always, we appreciate every jury’s time," he said. "It’s a serious job and they took it seriously.”

Several others were convicted in the scandal, including the former film office head, Tom Wheeler. He was convicted of felonious misconduct in office and given a deferred judgment and probation.