Papa John’s Franchise Owner Accused of £250K Eat Out to Help Out Fraud

A Papa John’s franchise owner is being investigated for an alleged Eat Out to Help Out fraud scheme in which he unlawfully processed hundreds of thousands of pounds’ worth of meals.

Raheel Choudhary owns 61 Papa John’s franchises and is suspected of stealing £250,000 of taxpayers’ money under cover of the scheme, according to The Sun.

Pizza chain Papa John’s has launched an investigation into the allegations.

Rishi Sunak’s Eat Out to Help Out scheme was designed to assist struggling restaurants during the pandemic. Customers who ordered takeaway or delivery received 50% off every Monday, Tuesday and Wednesday in August. The government chipped in the 50% in an effort to increase restaurants’ sales.

Papa John’s directed Choudhary to not participate in the government’s scheme, The Sun reported. 

But Choudhary allegedly advised the staff in 57 out of 61 of his Papa John’s stores to process thousands of meals in the Eat Out to Help Out fraud scheme, according to the BBC. Hundreds of thousands of pounds were allegedly wrongly claimed in Choudhary’s Eat Out to Help Out fraud. 

In one occurrence in Choudhary’s Eat Out to Help Out fraud plan, 13 food orders were processed in less than one minute at the Tunbridge Wells Papa John’s, the BBC reported. Meanwhile, the store has no tables, and the staff was not allowed to eat in the takeaway restaurant. 

Allegedly, Choudhary’s Eat Out to Help Out fraud strategy allegedly included instructing branch managers to reach targets of £500 to £600 a day at slower-traffic restaurants; busy branch managers were asked to reach a target of £1,000 a day. 

Payments were allegedly recorded by “phantom covers” as voucher payments in the Eat Out to Help Out fraud scheme, according to the BBC. 

“Of my 61 franchises, 40 have seating capacity, and we implemented the ‘Eat Out to Help Out Scheme’ in all of those 40 stores from Monday to Wednesday throughout August,” Choudhary said in a statement, according to the BBC. “All customers who benefited from the scheme ate in store and we are confident that we were fully compliant with the criteria set by the government.”

The value of the Eat Out to Help Out fraud scheme has also been challenged by a representative for Choudhary, who says the figure was more like £185,015 rather than the purported £250,000.

Choudhary’s representative added that 9% of August’s orders were a part of the Eat Out to Help Out scheme.

Choudhary said that when the Eat Out to Help Out scheme ended in August, his franchises continued offering their own discount in September. Choudhary said the branches averaged 32 customers daily in the 40 pizza shops that participated in the scheme.

Choudhary denies the allegations that he was the mastermind behind an Eat Out to Help Out fraud. Choudhary told the BBC, “We are confident that we were fully compliant with the criteria set by the government.”

“We will be extremely concerned and disappointed if they prove to be true,” a Papa John’s spokesperson told the BBC. “All of Papa John’s U.K. 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).”

The spokesperson added: “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.”

“It’s our duty to protect taxpayers’ money and we will not hesitate to act against those who attempt to break the rules,” an HM Revenue and Customs (HMRC) spokesperson told the BBC regarding the alleged Eat Out to Help Out fraud.

“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,” the HMRC spokesperson added. “Anyone concerned that an establishment is abusing the scheme can report fraud to HMRC.”

Do you think taxpayer money was stolen in the Papa John’s Eat Out to Help Out fraud scheme? Let us know what your opinion is in the comments.

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