Insolvency Practitioners Duties Regarding Bounce Back Loan Abuse!
- Thread starter UK Contractor Accountant
- Start date
From my side of things it's incredibly frustrating, with the extremes being stark. You see toothless and pointless director bans like this one, and genuinely misguided directors with small companies who took the BBL to live and survive, but because they were naïve and didn't pay themselves via PAYE from the BBL funds, are now facing personal liability issues and director bans.
Upvote
0
Surrey director moved £100,000 in fraudulent Covid loans through family bank accounts
Director sentenced for fraud and concealing criminal property- Muhammadh Chaudhry secured Covid Bounce Back Loans worth £100,000 in 2020 for two businesses which appeared never to trade
- Chaudry was previously known as Masood Jamati, the name he provided when making his first fraudulent application
- His second application was made just days after changing his name to Muhammadh Chaudhry and money from both loans was transferred through family members’ bank accounts back to him
- Chaudhry was handed a suspended sentence and director disqualification and has committed to paying back the money in full
Muhammadh Chaudhry, who previously went by the name of Masood Jamati, secured a £50,000 Bounce Back Loan for a media business in July 2020.
The 41-year-old then fraudulently obtained another £50,000 loan for UK Media Kit Hire Ltd in September 2020, which he claimed was a film and TV production company.
Money from the two loans was transferred through savings accounts held by close relatives.
Chaudhry, of Scotland Bridge Road, Addlestone, was sentenced to two years in prison, suspended for 22 months, at Guildford Crown Court on Wednesday 11 December.
He was also banned as a company director for seven-and-a-half years.
Chaudhry repaid the UK Media Kit Hire loan back in full during August and September 2024. He has also paid back £2,000 of the £50,000 from the second loan and agreed to repay the remaining balance.
Mark Stephens, Chief Investigator at the Insolvency Service, said:
Chaudhry first applied for a Bounce Back Loan at the start of July 2020, falsely claiming his annual turnover was £200,000 as a sole trader.
His second Bounce Back Loan application in September 2020 came just four days after he changed his name from Masood Jamati to Muhammadh Chaudhry.
Chaudhry claimed that the turnover for UK Media Kit Hire was again £200,000, the smallest amount businesses could put down in order to receive the maximum £50,000 permitted under the scheme.
Insolvency Service investigators found no evidence that UK Media Kit Hire had ever traded.
Chaudhry agreed to use the loans “wholly for business purposes” in making the applications.
However, money from the loans was moved through his family’s savings accounts before being paid back to him and his wife and withdrawn in a series of cash and cheque transactions.
Bank analysis revealed that money in the account was also used for holidays to Pakistan.
UK Media Kit Hire was dissolved in January 2021.
Upvote
0
- Original Poster
- #406
Well we are one year in for the Sole Trader BBL fraud Pilot Scheme That Has Been Secretly Tracking Business Owners For 3 Years that Over-stated their turnover or Weren’t Even Trading – Indicators Are Some 537,913 Business Owners Could Have overstated their turnover to obtain a BBL.
Bounce Back Loan Scheme (BBLS) Fraud Analytics Programme Phase 7 - Sole Trader Fraud
Purpose: The purpose of the pilot is to identify the extent of potential fraud committed by Sole Traders within the BBLS.Information sharing benefits. The pilot enables the Government to identify borrowers who fraudulently obtained BBLs and to place cases with Lenders and law enforcement agencies for recovery and/or prosecution.
Disclosed information Data items disclosed will be the minimum data items to allow this pilot’s aims to be achieved.
Information sharing method Secure File Transfer
Contact [email protected]
Start date 2023-11-23
End date 2025-11-30
Review date 2024-11-30
Upvote
0
I don't understand this. HMRC have the self assessments of all sole traders, so had the information to know whether turnover had been exaggerated based on historical figures. Only sole traders who had started trading (or not) but not reached the point of submitting a SA may have exaggerated, but turnover after Covid may have little relevance as trade could have been permanently adversely affected by Covid.
As an example, an acquainrance was so excited to be opening their first cafe in the middle of a business park, with an opening date of 16 March 2020. They legitimately requestd a BBL, based on their projected turnover, but even with the BBL they did not survive to reopen.
Upvote
0
- Original Poster
- #408
Oh I think lots of others as well ! - there were no checks being done by the Banks so there was a lot of fraud going on relating to exaggerated turnover figures.
Think they have highlighted quite a few where turnover for BBL was above the VAT registration limit but tax return figures were well below vat threshold.
Upvote
0
The accountants on here might cynically suggest that they asked HMRC for the information in 2021, and HMRC have only just got round to replying.
Upvote
0
Why on earth does the Insolvency Service issue press releases like this? Do they not realise how pathetically toothless it makes them look? A woman in Dubai, who effectively nicked £23,000 from the taxpayer, is banned from being a company director, but gets to keep the stolen money - yes, a fantastic result, that's a real disincentive to other would be fraudsters!
Upvote
0
- Original Poster
- #412
Here's some good news to cheer you all up during the January blues:
A convicted Covid loan fraudster has sold his BMW and flat to repay the £50,000 he illegally obtained.
Sameer Saeed was handed a suspended sentence and director ban in December 2022 after admitting fraudulently securing a Bounce Back Loan in 2020 and unsuccessfully applying for another.
The 44-year-old also applied to have his Digital Business Box Ltd company struck off the Companies House register 12 days after receiving the £50,000 loan.
Confiscation proceedings brought by the Insolvency Service led to Saeed first selling the BMW he bought and now his flat on Stoneleigh Road in Ilford.
A convicted Covid loan fraudster has sold his BMW and flat to repay the £50,000 he illegally obtained.
Sameer Saeed was handed a suspended sentence and director ban in December 2022 after admitting fraudulently securing a Bounce Back Loan in 2020 and unsuccessfully applying for another.
The 44-year-old also applied to have his Digital Business Box Ltd company struck off the Companies House register 12 days after receiving the £50,000 loan.
Confiscation proceedings brought by the Insolvency Service led to Saeed first selling the BMW he bought and now his flat on Stoneleigh Road in Ilford.
Upvote
0
Lancashire plasterer exaggerated turnover by more than £200,000 to secure maximum-value Covid loan
Suspended sentence for sole trader who committed Bounce Back Loan fraud- Jordan Allen fraudulently secured a £50,000 Covid Bounce Back Loan in 2020 - the most businesses were entitled to under the scheme - by overstating his turnover by more than £200,000
- His plastering business should only have received around £5,000 if he had submitted an accurate application for the loan
- Allen, who was declared bankrupt the following year and is currently subject to stringent bankruptcy restrictions, used the loan for personal expenses such as supermarket shopping and gambling
Jordan Allen, 39, was sentenced to 16 months in prison, suspended for two years, when he appeared at Preston Crown Court on Monday 20 January.
Allen, of Monarch Street, Oswaldtwistle, was ordered to complete 200 hours of unpaid work and 10 days of rehabilitation activity.
He must also pay £3,600 in compensation.
David Snasdell, Chief Investigator at the Insolvency Service, said:
Allen applied for a £50,000 Bounce Back Loan on behalf of his PlasteRend business in October 2020, stating that his estimated annual turnover was £225,000.
Insolvency Service analysis revealed his turnover for 2018 to 2019 was £20,220 and for 2019 to 2020 was £20,330.
Allen claimed that he was “optimistic” at the time that a business opportunity which failed to materialise would have seen his turnover increase to the level he submitted in his application.
The rules of the Bounce Back Loan Scheme, however, clearly stated that it was an actual, rather than projected turnover, that should be declared on the application form.
Bounce Back Loan funds which were paid into Allen’s business account were transferred to his personal account in January and February 2021.
Almost £17,000 worth of personal spending was identified by the Insolvency Service as soon as the funds arrived in Allen’s personal account.
He made 39 cash withdrawals, each worth £250, in a six-week period between mid-February and early April in 2021.
In addition to the £9,750 he withdrew, Allen also spent more than £7,000 on groceries, gambling, a raffle and fantasy football.
Allen said his personal bank account was used for running both his business and managing his personal accounts.
However, the funds in his account outside of the Bounce Back Loan and a Self-Employment Income Support Scheme grant he also secured in May 2021 were not sufficient to support his personal spending during that period.
Allen was declared bankrupt in September 2021 and signed a 10-year Bankruptcy Restrictions Undertaking in July 2022, restricting him from being able to borrow more than £500 without disclosing his bankrupt status.
Upvote
0
- Original Poster
- #415
Cash Grab Back Initiative - not sure much use as the BBL money would be have been spent
An anti-fraud squad will be given the power to raid the properties of Covid fraudsters and recover taxpayers’ money from their bank accounts.
The new measures, which will be introduced to parliament on Wednesday as part of the fraud bill, will give the Cabinet Office’s Public Sector Fraud Authority the means to issue civil penalties to provide an alternative to criminal prosecution, which would be applied retrospectively.
The government is seeking to bolster the Covid corruption commissioner’s ability to investigate suspected fraud cases, including those unrelated to the pandemic where people are suspected of defrauding the government, such as fake companies getting taxpayer-funded grants.
The authority will be able to use strong civil penalties to provide an alternative deterrent to criminal prosecution. The time limit to bring civil claims against fraudsters will be extended from six to 12 years.
The PSFA will get the power to compel companies and individuals to hand over evidence, and apply for court warrants such as search warrants to seize evidence and take money directly from the bank account of fraudsters.
An anti-fraud squad will be given the power to raid the properties of Covid fraudsters and recover taxpayers’ money from their bank accounts.
The new measures, which will be introduced to parliament on Wednesday as part of the fraud bill, will give the Cabinet Office’s Public Sector Fraud Authority the means to issue civil penalties to provide an alternative to criminal prosecution, which would be applied retrospectively.
The government is seeking to bolster the Covid corruption commissioner’s ability to investigate suspected fraud cases, including those unrelated to the pandemic where people are suspected of defrauding the government, such as fake companies getting taxpayer-funded grants.
The authority will be able to use strong civil penalties to provide an alternative deterrent to criminal prosecution. The time limit to bring civil claims against fraudsters will be extended from six to 12 years.
The PSFA will get the power to compel companies and individuals to hand over evidence, and apply for court warrants such as search warrants to seize evidence and take money directly from the bank account of fraudsters.
Upvote
0
Tough restrictions for Sheffield hairdresser and baker who falsely claimed £98,000 in Covid loans
Bankrupt hairdresser claimed two separate loans totalling £98,000 for a new business which only traded for two weeks- Hannah Lucy Walker applied for two Covid Bounce Back Loans to claim a total of £98,000
- She took the loans for a new business which was not entitled to any money under the scheme and gave false information in her applications
- Walker is now subject to 12 years of sanctions which restrict her finance and business activities to protect the public from further harm
Hannah Lucy Walker, 31, of Pollard Crescent in Sheffield, was originally a hairdresser.
But when Covid lockdowns were in operation during May 2020, she also began a baking business, trading as Something Sweet.
And on 25 June 2020, Walker applied for a £50,000 Bounce Back Loan for Something Sweet – which only ever traded for two weeks - declaring its turnover was £256,000.
The next day she applied to a different bank for another Bounce Back Loan of £48,000 for the baking business. This time she claimed the business had a turnover of £230,000.
Walker was made bankrupt in March 2024, with outstanding debts of around £109,000 including the full amount of both loans.
The Official Receiver, whose duty includes investigating the cause of a bankruptcy, found that Something Sweet had not been eligible to apply for a loan.
Samantha Crook, Deputy Official Receiver at the Insolvency Service, said:
Under the rules of the Bounce Back Loan scheme, businesses must have been trading by 1 March 2020 in order to apply for a loan.
The rules allowed applications for a single loan per business of up to 25% of its 2019 turnover – or of an estimated turnover if the business had started during the previous financial year – up to a maximum of £50,000. Any money claimed was to be used for the economic support of the business.
Walker’s baking business was not entitled to any money through the scheme. She did not apply for a loan to support her hairdressing business.
Walker signed a Bankruptcy Restrictions Undertaking in which she did not dispute that she had provided false information on two Bounce Back Loan applications to receive a total of £98,000 to which she was not entitled.
She must abide by the restrictions, which extend the terms of her original bankruptcy - usually a period of 12 months – for a further 12 years.
They prevent Walker from acting as a company director without permission from the court and from borrowing more than £500 without declaring that she is subject to the sanctions. She is also restricted from holding certain roles in public organisations while subject to the measures.
The Secretary of State for Business and Trade accepted the undertaking on 14 January 2025. The restrictions will run until 13 January 2037.
Upvote
0
Court shuts down two connected companies which received more than £1 million in fraudulent Covid loans
Winding-up orders made against companies accused of loan fraud- Ledbridge Consultants Limited and Montague Partners Ltd secured funds from Covid support schemes they were not entitled to
- Both failed to use the funds to support their businesses, filed suspicious accounts with Companies House and used people’s identities unlawfully
- The companies were wound-up at the High Court following investigations by the Insolvency Service
Ledbridge Consultants Limited and Montague Partners Ltd, which had registered offices in Birmingham and London, were wound-up at the High Court in London on Tuesday 10 September.
Insolvency Service investigations into both Ledbridge Consultants and Montague Partners concluded that both had never genuinely traded and were used as fronts for obtaining large amounts of money.
Cheryl Lambert, Chief Investigator at the Insolvency Service, said:
The two companies, which claimed to be financial intermediaries and management consultants respectively, each falsely secured £50,000 Bounce Back Loans, the maximum allowed under the terms of the scheme designed to support businesses through the pandemic.
Payments worth £1.5 million from the Future Fund - another government Covid support scheme - were also paid into Montague Partners’ bank account after being obtained in the names of three other companies.
The £1.5 million paid into Montague Partners’ account was paid out to 35 individuals within a short space of time. Ten of the 35 beneficiaries received more than £75,000, spread out over numerous smaller transactions.
Similarly, the £50,000 Bounce Back Loan paid into Ledbridge Consultants’ bank account in May 2020 was paid out to a number of individuals and companies within a matter of weeks.
By the following month, Ledbridge Consultants had nothing in their account.
However, just one year later, the company filed accounts at Companies House showing their total net assets had increased by £13.4 million between February and August 2021.
Montague Partners also filed suspicious accounts showing total net assets of £2.2 million in November 2020, compared to £1 for the previous accounting period to November 2019.
Insolvency Service investigations also indicated that both Ledbridge Consultants and Montague Partners had used the identities of people who had applied for jobs online to set up companies without their knowledge or consent. They also used their personal data to register them as directors, shareholders, or investors in the two companies and to file suspicious documents with Companies House.
Ledbridge Consultants and Montague Partners failed to co-operate with the Insolvency Service, meaning investigators were unable to determine who controlled the companies and the purpose of significant payments made from their bank accounts.
The Official Receiver has been appointed as liquidator of both companies.
Upvote
0
Decade-long ban for director of London bakery who abused Covid support scheme
Director disqualified for Bounce Back Loan abuse- Azizullrahman Akbari overstated his company’s turnover when he applied for a £50,000 Bounce Back Loan - the maximum amount businesses could receive under the scheme
- His New Watan Bakery Limited company did not have a turnover of more than £200,000 as he falsely claimed
- Akbari has been banned as a company director until January 2035 following investigations by the Insolvency Service
Azizullrahman Akbari, 60, obtained a £50,000 Bounce Back Loan just weeks into the pandemic, claiming the turnover for his New Watan Bakery Limited company was more than £200,000.
In reality, the company, which ran the Watan Bakery on South Road in Southall, never had such a high turnover.
Elizabeth Pigney, Chief Investigator at the Insolvency Service, said:
New Watan Bakery began trading in June 2016, with Akbari as its sole director.
Akbari, of The Broadway, Southall, applied for a Bounce Back Loan in May 2020, declaring his company had a turnover of £214,010.
Businesses established before the start of January 2019 could apply for a Bounce Back Loan of up to a quarter of their annual turnover, with a maximum amount of £50,000.
Insolvency Service analysis of the company’s accounts revealed a turnover of £62,584 for the period up until the end of June 2019.
For the period ending June 2020, the turnover was smaller at £52,370.
New Watan Bakery entered liquidation in July 2023 owing more than £53,000.
The Secretary of State for Business and Trade accepted a disqualification undertaking from Akbari, and his ban started on Wednesday 29 January.
The undertaking prevents him from being involved in the promotion, formation or management of a company, without the permission of the court.
A separate company now runs the bakery. Akbari is not listed as a director of this company.
Upvote
0
An ACCA trained accountant and serial Covid fraudster has been jailed for over three years after abusing Covid support systems to attempt to claim over £300,000
Zeeshan Ashraf, 44, from Hall Green in Birmingham, defrauded several government Covid schemes to claim a total of £268,102.07, using his company, AZ Certified Accounting Limited, to claim bounce back loans from three separate banks.
Just one of the £50,000 bounce back loans was approved, however Ashraf inflated his turnover by more than four times to claim the full amount.
Additionally, Ashraf fraudulently claimed £91,174 from the Coronavirus Job Retention Scheme (CJRS) on behalf of clients that did not authorise him to, some were completely fictional. He attempted to claim a further £38,082, but this claim was rejected by HMRC.
The accountant also abused the Eat Out to Help Out scheme, claiming £26,928 via hospitality companies that did not exist, and on behalf of companies that were not restaurants. A further £14,651 claim was rejected.
A website for the firm associated with Ashraf claims to be linked with ACCA, displaying the institute’s logo as if the business had official accreditation.
An ACCA spokesperson told Business & Accountancy Daily:
Kate Hurst, prosecutor from the Crown Prosecution Service said:
The offences took place for over a year between April 2020 and April 2021, with Ashraf pleading guilty at Birmingham Crown Court on 18 September 2024 to five counts of fraud.
Five months since the court case, Ashraf was sentenced on 3 February 2025 to three years and eight months’ imprisonment.
---
www.accountancydaily.co/acca-accountant-jailed-ps268k-covid-fraud
www.cps.gov.uk/west-midlands/news/fraudster-who-defrauded-covid-eat-out-help-out-scheme-jailed
Upvote
0
Companies House shows him having resigned as director back in 2014 and never having been a major shareholder, so not really sure how it is HIS company.
find-and-update.company-information.service.gov.uk/company/07546636/officers
Upvote
0
Former owner of Gillingham takeaway sanctioned for £50,000 Covid loan abuse
Former owner of Chinese takeaway in Kent claimed maximum loan for business which was not eligible for any money- Zhongqing Li claimed a £50,000 Bounce Back Loan for his Chinese takeaway despite the business not being eligible for the scheme
- The Official Receiver uncovered the abuse of the loan after the takeaway owner became bankrupt.
- He is now subject to nine years of sanctions which prevent him acting as a company director
Zhongqing Li, 55, from Parkwood Green, Gillingham, applied for the loan in June 2020 to support his Silver Sea takeaway, which also traded from Parkwood Green.
Li became bankrupt in June 2024, owing the full amount of the loan.
The Official Receiver, whose duty includes investigating the cause of a bankruptcy, discovered that Silver Sea had not been trading within the required timeframe to have been eligible for a Bounce Back Loan.
Samantha Crook, Deputy Official Receiver at the Insolvency Service, said:
Li made a loan application on 15 June 2020 in which he stated that Silver Sea had been trading on 1 March 2020 – the date businesses had to have been trading to qualify for a loan under the rules of the scheme.
But the Official Receiver discovered that the day before he applied for the loan, Li had signed a VAT registration form saying the business had only begun trading in the previous month, on 17 May 2020.
The Official Receiver secured a Bankruptcy Restrictions Undertaking (BRU) from Li, in which he did not dispute that he had obtained a £50,000 Bounce Back Loan to which he was not entitled because he was not trading on or before 1 March 2020, as required by the terms of the scheme.
He agreed to abide by sanctions that restrict his finance and business activities, and extend the original terms of his bankruptcy – usually a 12-month period – for another nine years.
The restrictions prevent him acting as a company director without permission from the court, and from holding certain roles in public organisations. He is also prohibited from borrowing more than £500 without declaring he is subject to the sanctions.
The Secretary of State for Business and Trade accepted the undertaking from Zhongqing Li on 28 January 2025. He will be subject to the restrictions until 27 January 2034.
The Silver Sea takeaway continues to trade under different owners.
The Official Receiver continues to make enquiries into possible recovery of the money.
Upvote
0
It means that your company technically owes money to British Business Bank (AKA the tax-payer) - though if you haven't abused the system it will be written off.
Upvote
0
Ah ok, so in terms of filing annual non-trading accounts, the accounts will still need to include the liability then. Is there a likely timescale for BBL's ultimately being written off? My understanding is that BBB are blocking all strike off applications even when the guarantee has been paid? If the strike-off went through, does that mean the debt is written off? I know from the various threads on here that they can still take action post-strike off, although no major concerns about that as the company met the eligibility criteria and used the funds in line with the guidelines.
Upvote
0
How long did it take mine been sat in limbo for few years, I took advice from Lisa on here who was been helpful. Who reassured me. I would recommend @Lisa Thomas to anyone.
Upvote
0
Sussex cafe owner took £150,000 in Covid funds for dormant companies
He also attempted to strike-off one of the companies to avoid repaying the loan- Mehmet Akyuz fraudulently applied for three Bounce Back Loans for his organic food shop and cafe and leather import business
- Akyuz secured £150,000 in funds when both companies were dormant and not trading
- He was sentenced for fraud by false representation following Insolvency Service investigations
Mehmet Akyuz, 36, fraudulently obtained three maximum-value Bounce Back Loans worth £50,000 each in 2020 for his Green and Hove Limited and Leathers Wear Limited companies.
Both Green and Hove, trading as Organic Earth Cafe, and Leathers Wear, were dormant at the time of Akyuz’s applications.
Akyuz, of Conway Street, Brighton and Hove, was sentenced to 20 months in prison, suspended for two years, when he appeared at Hove Crown Court on Monday 14 April.
He was also disqualified as a company director for five years and ordered to complete 300 hours of unpaid work.
David Snasdell, Chief Investigator at the Insolvency Service, said:
Green and Hove and Leathers Wear were incorporated in February and March 2019 with Akyuz as the sole director. The former was a retail food and grocery store with a cafe attached while the latter was described by Akyuz as an importer of leather goods such as bags and belts.
However, neither was trading at the time Akyuz made the fraudulent applications to the banks in the summer and autumn of 2020.
Akyuz fraudulently applied for the £50,000 loan on behalf of Green and Hove in August 2020, claiming the company’s turnover was £270,000.
This declaration was untrue, as Insolvency Service investigations found that the company filed dormant accounts in 2020, 2021 and 2022.
Between September 2020 and January 2021, more than £36,000 of the loan was transferred directly to Akyuz. The remainder of the money was paid out in miscellaneous, one-off payments.
Akyuz committed further fraudulent offences in October 2020, when he applied to two separate banks for £50,000 Bounce Back Loans on behalf of Leathers Wear.
In the applications, Akyuz falsely declared that the company had a turnover of £215,000 and £225,000.
However, Leathers Wear also filed dormant accounts in 2020, 2021 and 2022 and was not trading when the application was made.
The funds were again transferred into Akyuz’s personal account and not used for business purposes.
Akyuz unsuccessfully applied to have Leathers Wear struck-off the Companies House register in June 2022 in an attempt to avoid repaying the loan.
The Insolvency Service is seeking to recover the fraudulently obtained funds under the Proceeds of Crime Act 2002.
(gov.uk/government/news/sussex-cafe-owner-took-150000-in-covid-funds-for-dormant-companies)
Upvote
0
Building contractor sentenced for £50,000 Covid loan fraud
Florin-Petrica Bodale, who was a sole trader operating as a building contractor, exaggerated his turnover to obtain the maximum Bounce Back Loan.- Florin-Petrica Bodale was a building contractor and sole trader, operating in Harrow.
- He claimed his business had a turnover of more than £200,000 to claim the maximum Covid Bounce Back loan.
- He was sentenced to 13-months imprisonment, suspended for 18 months, following a hearing at Snaresbrook Crown Court.
Florin-Petrica Bodale operated as a building contractor offering plumbing, heating and air-conditioning installation and was based in Harrow, London.
In November 2020, the 34-year-old successfully applied to a bank for a Covid Bounce Back loan of £50,000.
But an Insolvency Service investigation found that he had falsely claimed the company’s turnover was £240,000 to receive the maximum loan available.
In reality, the turnover of the company was around £22,000 – meaning he was only entitled to £5,500.
On 10 April 2025, at Snaresbrook Crown Court, Bodale was sentenced to 13-months imprisonment, suspended for 18 months, for one count of fraud by false representation.
He was also ordered to complete 250 hours of unpaid work.
Insolvency Service Chief Investigator David Snasdell said:
In 2022, before the criminal investigation, Bodale signed a ten-year bankruptcy restriction undertaking which also included a ten-year director disqualification following a civil investigation by the Insolvency Service.
The court noted that he had repaid some money as part of the bankruptcy process.
Measures were introduced during 2020 to support businesses affected by COVID-19 such as loans, grants and tax allowances. The Bounce Back loan scheme helped small and medium-sized businesses to borrow between £2,000 and £50,000, at a low interest rate, guaranteed by the Government.
The Bounce Back loans were made on the condition that they were not to be used for personal purposes, but could be used, for example, to purchase a company asset such as a vehicle, if it would provide an economic benefit to the business.
(gov.uk/government/news/building-contractor-sentenced-for-50000-covid-loan-fraud)
Upvote
1
what about those of us who may feel we have no way out of the situation and are now concerned that although we took no money out of the business (in my case I didn't take wages either) but due to covid my business has failed and I cannot afford to hire an IP that even if I did could land me in even more financial trouble ? I was called up as a reservist which meant I was being paid by the Army. I was very careful when reading the documentation and I even stated to a few friends that what they are doing is going to bite them, did I do anything wrong ? I really don't think so, but it appears to be down to how one interpreted the government docs !
Upvote
0
May I ask why you think it could land you in more financial trouble if an IP is involved, if you believe you have not committed misconduct?
Upvote
0
Because I believe I did everything by the book, however it was a minefield to negotiate, there was no advice, no help, no one to ask, I may have incorrectly filled out the form or used data for the wrong year, I really don't know, but lets face it, if we want something to be completely screwed up then get the government involved, for instance I found out about the business grant for businesses that have a business rated property, but I have friends that didn't know about it and worse I have friends where the landlord claimed it as it was their property, it was a complete fiasco.
Upvote
0
Covid fraud investigations to be led by Insolvency Service
Insolvency Service to take over NATIS’s ongoing covid fraud investigationsPublished 15 May 2025
DBT - COVID FRAUD INVESTIGATIONS TO BE LED BY INSOLVENCY SERVICE
- Insolvency Service to take over NATIS’s ongoing covid fraud investigations
- Decision comes after review of previous government contracts proved taxpayers’ money was not being spent efficiently
- Government focussed on reducing waste in the public sector and recovering public money lost through pandemic-related fraud
Following a review of National Investigation Service (NATIS) performance to ensure the state works for people – it showed that public money was not being spent effectively – which is why all ongoing viable cases will be transferred from the organisation to the Insolvency Service over the coming months.
This is the latest move as part of the government’s Plan for Change to reduce waste in the public sector and reform institutions so they protect taxpayers money, and make the public sector more efficient and effective.
The decision to appoint NATIS – an agency based in Thurrock Council – was taken under the previous government and has cost the taxpayer approximately £38.5 million. Despite this, NATIS has only secured 14 convictions with the overall amount recovered by NATIS remaining unclear.
Within months of coming to power, this Government kicked off a review into their performance, to ensure public money is spent properly and not wasted. This investigation has revealed problems with NATIS governance and how recoveries are reported. As a result the government has asked The Government Internal Audit Agency (GIAA) to conduct an additional audit of NATIS to determine and report accurate recovery figures.
Following this review, the department has taken decisive action to transfer cases to the Insolvency Service – who have a proven track record of effectively tackling fraud - giving taxpayers’ money the best possible value.
Whilst over £46bn has been issued by lenders to support businesses, there have been over 100,000 cases of loss to fraud and error. This measure will ensure the continuation of ongoing investigations and expedite the recovery of millions estimated to be lost due to covid-era fraud.
Business and Trade Minister Gareth Thomas said:
The Insolvency Service will be taking responsibility for NATIS casework, helping to conclude investigations to continue the important work to claw back money for the public.
The Insolvency Service has a proven track record tackling fraud and misconduct connected to covid support schemes since 2020 using its powers to investigate trading companies, prosecute criminal offences, disqualify directors and impose bankruptcy restrictions.
By the end of March 2025, they had secured more than 2,000 director disqualifications as well as 62 criminal convictions, helping to secure more than £6 million in compensation related to COVID-19 financial support scheme abuse.
gov.uk/government/news/covid-fraud-investigations-to-be-led-by-insolvency-service
Upvote
0
- Original Poster
- #433
Loan Fraudster - 18 Months Prison Sentence (suspended)
Rico Iheagwara fraudulently applied for two £20,000 Bounce Back Loans during the summer of 2020
Iheagwara’s SJR Recruitment Limited company was not trading at the time of the applications
SJR Recruitment was placed into liquidation in 2021 with liabilities of more than £67,000
A recruitment consultant who fraudulently spent Covid support funds for personal purposes has been handed a suspended sentence.
Rico Iheagwara secured two Bounce Back Loans worth £20,000 each from different banks for his Essex-based SJR Recruitment Limited company when businesses were only entitled to a single loan under the scheme.
Iheagwara, 36, of River Meads, Stanstead Abbotts, Hertfordshire, was sentenced to 18 months in prison, suspended for 18 months, for fraud when he appeared at St Albans Crown Court on Friday 16 May.
He was also ordered to complete 120 hours of unpaid work and 15 days of rehabilitation activity.
David Snasdell, Chief Investigator at the Insolvency Service, said:
For both applications, made in June and July 2020, Iheagwara claimed the company’s turnover was £82,000.
Iheagwara transferred the first £20,000 loan into his personal account on the same day he received the funds. For the second loan, he moved all £20,000 into his personal account the following day.
None of the £40,000 was used for the economic benefit of his business. Insolvency Service analysis of bank statements suggested that the funds were used for everyday expenses and paid to various family members.
In interviews, Iheagwara said he spent the funds on rent, paying off personal finance and supporting his children.
SJR Recruitment went into liquidation in April 2021. No repayments were made on the loans.
The Insolvency Service is seeking to recover the fraudulently obtained funds under the Proceeds of Crime Act 2002.
Rico Iheagwara fraudulently applied for two £20,000 Bounce Back Loans during the summer of 2020
Iheagwara’s SJR Recruitment Limited company was not trading at the time of the applications
SJR Recruitment was placed into liquidation in 2021 with liabilities of more than £67,000
A recruitment consultant who fraudulently spent Covid support funds for personal purposes has been handed a suspended sentence.
Rico Iheagwara secured two Bounce Back Loans worth £20,000 each from different banks for his Essex-based SJR Recruitment Limited company when businesses were only entitled to a single loan under the scheme.
Iheagwara, 36, of River Meads, Stanstead Abbotts, Hertfordshire, was sentenced to 18 months in prison, suspended for 18 months, for fraud when he appeared at St Albans Crown Court on Friday 16 May.
He was also ordered to complete 120 hours of unpaid work and 15 days of rehabilitation activity.
David Snasdell, Chief Investigator at the Insolvency Service, said:
Iheagwara was also the sole signatory on both company bank accounts which were opened in May 2020, just one month before his first fraudulent application.
For both applications, made in June and July 2020, Iheagwara claimed the company’s turnover was £82,000.
Iheagwara transferred the first £20,000 loan into his personal account on the same day he received the funds. For the second loan, he moved all £20,000 into his personal account the following day.
None of the £40,000 was used for the economic benefit of his business. Insolvency Service analysis of bank statements suggested that the funds were used for everyday expenses and paid to various family members.
In interviews, Iheagwara said he spent the funds on rent, paying off personal finance and supporting his children.
SJR Recruitment went into liquidation in April 2021. No repayments were made on the loans.
The Insolvency Service is seeking to recover the fraudulently obtained funds under the Proceeds of Crime Act 2002.
Upvote
0
- Original Poster
- #434
Get your BBL affairs in order!!
Those of you with "iffy" BBL's still in existence are being urged to set up a no nonsense affordable payment plan with your BBL Lender before the Public Authorities (Fraud, Error & Recovers) Bill will get Royal Assent which will have wide sweeping powers to allow Civil Servants to extract funds direct from your Bank account where they believe you committed wrongdoing and money is owed back to the Taxpayer.
The Bill has passed through the House of Parliament and is currently at the Report Stage with House of Lords before passing into the final stages for any recommended amendments and then Royal Assent which is likely to be this Winter.
BILL EXTRACT - Recovery from bank accounts etc
17 Direct deduction orders
(1) Where a payable amount is recoverable from a liable person who holds an account with a bank, the Minister may make an order (a “direct deduction order”) in respect of that account.
(2) A direct deduction order must be given to the bank with which the account is held.
(3) A direct deduction order may be—
(a) a regular direct deduction order, or
25(b) a lump sum direct deduction order.
(4) A regular direct deduction order is an order requiring the bank—
(a) to make regular deductions from the liable person’s account, and
(b) to pay the amounts deducted to the Minister.
(5) A lump sum direct deduction order is an order requiring the bank—
30(a) to deduct from the liable person’s account an amount specified in the
order, and
(b) to pay that amount to the Minister.
Those of you with "iffy" BBL's still in existence are being urged to set up a no nonsense affordable payment plan with your BBL Lender before the Public Authorities (Fraud, Error & Recovers) Bill will get Royal Assent which will have wide sweeping powers to allow Civil Servants to extract funds direct from your Bank account where they believe you committed wrongdoing and money is owed back to the Taxpayer.
The Bill has passed through the House of Parliament and is currently at the Report Stage with House of Lords before passing into the final stages for any recommended amendments and then Royal Assent which is likely to be this Winter.
BILL EXTRACT - Recovery from bank accounts etc
17 Direct deduction orders
(1) Where a payable amount is recoverable from a liable person who holds an account with a bank, the Minister may make an order (a “direct deduction order”) in respect of that account.
(2) A direct deduction order must be given to the bank with which the account is held.
(3) A direct deduction order may be—
(a) a regular direct deduction order, or
25(b) a lump sum direct deduction order.
(4) A regular direct deduction order is an order requiring the bank—
(a) to make regular deductions from the liable person’s account, and
(b) to pay the amounts deducted to the Minister.
(5) A lump sum direct deduction order is an order requiring the bank—
30(a) to deduct from the liable person’s account an amount specified in the
order, and
(b) to pay that amount to the Minister.
Upvote
0
I understood that if two (or more) companies were associated they could only apply for one BBL. So ther is a problem befor you look at the tarding non-history.Wonder what will happen here?
Reform MP James McMurdock gives up whip over business allegations, party says
James McMurdock denies any wrongdoing over claims relating to pandemic-era loans taken out by his companies.www.bbc.co.uk
Upvote
0
London Covid fraudster jailed after using fraudulently obtained Bounce Back Loans to fund trading in Ghana
Jail term for Bounce Back Loan fraudster who exploited government scheme- Eric Agyeman fraudulently secured £130,000 across three Bounce Back Loan applications in 2020 by fabricating turnover figures for a company which never traded
- Agyeman transferred more than £40,000 of the funds into a separate trading operation purchasing goods for export to Ghana through an associate who would sell them and return commission payments
- The 46-year-old was jailed and banned as a company director after pleading guilty to fraud and money laundering following investigations by the Insolvency Service
Eric Agyeman obtained £130,000 in three Bounce Back Loans for DOK Logistics UK Ltd when businesses were only entitled to a single loan under the scheme.
Agyeman invented turnover figures of as much as £375,000 when the company never actually traded.
The 46-year-old then used more than £40,000 of the Bounce Back Loans to fund a separate business scheme in Ghana, where he would send goods from the UK to an associate in the West African country and receive commission on the sales.
Agyeman, of Mace Street, London, was sentenced to two years and two months in prison at the Old Bailey on Tuesday 9 September after pleading guilty to offences of fraud and money laundering.
He was also disqualified as a company director for five years.
David Snasdell, Chief Investigator at the Insolvency Service, said:
DOK Logistics UK Ltd was set up on Companies House in February 2020, with its nature of business described as “other transportation support activities”.
However, Insolvency Service investigations revealed that the company was not trading at the beginning of March 2020, as was required to qualify for Covid support funds.
Indeed, there is no evidence that the company ever traded.
Agyeman first applied for a Bounce Back Loan of £30,000 in early May 2020, on the first day the scheme opened.
In the application, he falsely claimed that DOK Logistics UK Ltd’s estimated turnover was £120,000.
Just nine days later, he applied to a different bank for a £50,000 Bounce Back Loan, this time stating that the company’s estimated turnover was £275,000.
Agyeman’s third fraudulent application came in July 2020, when he provided an estimated turnover of £375,000 to secure another £50,000 Bounce Back Loan.
In interviews with the Insolvency Service, he acknowledged the turnover figures were made up, admitting he “took it for granted” and “didn’t really put much emphasis into thinking about the figures” and that “it’s just something I just made up.”
Even if Agyeman’s estimated turnover figures were accurate, businesses were only entitled to a single loan under the terms of the scheme.
A total of £44,415 of the fraudulently obtained funds was channelled into buying goods that were then transported to his contact in Ghana for onward sale, generating commission payments back to Agyeman.
The money from goods sold in Ghana would be converted to British pounds locally, and visitors to the UK would physically bring this cash back to him.
Insolvency Service investigators also concluded that other unexplained payments were not for the economic benefit of DOK Logistics UK Ltd.
The Insolvency Service is seeking to recover the fraudulently obtained funds under the Proceeds of Crime Act 2002.
Upvote
0
Yorkshire scaffolding boss ordered to repay £100,000 Covid funds he fraudulently obtained in full plus interest
The director was convicted earlier this year following Insolvency Service investigations- Mark Degnan will have to repay more than £115,000 after fraudulently securing two £50,000 Bounce Back Loans during the pandemic
- Degnan falsely claimed his scaffolding company had a turnover of half a million pounds, and applied for two loans when businesses were only entitled to one
- The 56-year-old, who was previously handed a suspended sentence and has repaid almost £60,000 of the funds, must pay back the remaining money or face time in jail
Mark Degnan, 56, repaid £55,608 before appearing at Leeds Crown Court on Monday 15 September where he was ordered to repay the remaining £59,578 within six months.
If Degnan, of Wellhams Road, Pontefract, fails to pay back the money, he will face a year in prison.
This comes on top of Degnan receiving a two-year suspended sentence in January this year after inflating his turnover to secure the two £50,000 Bounce Back Loans in 2020 for MBL Scaffolding Services Ltd.
Alexander Grierson, Head of Asset Recovery at the Insolvency Service, said:
Degnan claimed in both fraudulent applications to separate banks in May and July 2020 that MBL Scaffolding Services Ltd’s turnover was £500,000.
These applications were made despite dormant company accounts being filed for 2019.
Investigators found that the company’s turnover in 2019 was closer to £162,000, meaning that it was still ineligible for the full amount. Under the rules of the scheme, businesses could borrow up to a quarter of their annual turnover, with a maximum loan of £50,000.
Degnan was sentenced to two years in prison, suspended for two years, at Leeds Crown Court in January 2025.
He was also disqualified as a company director for five years and ordered to complete 50 hours of unpaid work.
Upvote
0
MR ERIC NANA OFORI AGYEMAN:
In interviews with the Insolvency Service, he acknowledged the turnover figures were made up, admitting he “took it for granted” and “didn’t really put much emphasis into thinking about the figures” and that “it’s just something I just made up.”
Lol!
Right time for me to do a VAT 1/4
Wonder how much emphasis I should put into thinking about the figures.
2 year sentence seems one of the longest given. No repayment orders. Would love to know this guys background.
In interviews with the Insolvency Service, he acknowledged the turnover figures were made up, admitting he “took it for granted” and “didn’t really put much emphasis into thinking about the figures” and that “it’s just something I just made up.”
Lol!
Right time for me to do a VAT 1/4
Wonder how much emphasis I should put into thinking about the figures.
2 year sentence seems one of the longest given. No repayment orders. Would love to know this guys background.
Upvote
0
Latest Articles
-
The Most Dangerous Moment in Business Is When Everything Is Going WellThey Saw It Coming. They Did Nothing. The Lessons Every Business Owner...- Ozzy
- Updated:
-
AI and Your Business: Useful Tool, Not a Magic WandThere is no shortage of noise around artificial intelligence right now...
- Ozzy
- Updated:
-
Companies House WebFiling security incident: what happened, what to check, and what to do nextCompanies House has confirmed that its WebFiling service suffered a...
- Ozzy
- Updated:
-
Spring Budget 2026: A Quiet Update for UK BusinessesChancellor Rachel Reeves delivered the UK’s Spring Statement on 3 March...
- Ozzy
- Updated:
-
Practical Ways to Make Your Small Business More Resilient (Especially When the Unexpected Happens)Running a business means juggling plenty of things you can plan for and...- UKBF Editor
- Updated:
