£58k bounce back loan fraudsters get 18-year ban
Last month, we warned that directors who dissolve companies when there are still liabilities are now being specifically targeted for Director disqualification.
The Rating (Coronavirus) and Directors Disqualification (Dissolved Companies) Act 2021 now helps The Insolvency Service tackle directors who dissolve companies to avoid repaying Government backed loans such as the bounce back loan and last week it was reported that they have successfully secured restrictions against a gym operator and roofer after they falsely applied for bounce back loans.
The pair applied for close to £60,000 from the bounce back loan scheme, intended to support businesses during the pandemic. One spent £13,000 of the BBL on gambling websites over the space of three weeks! The full details can be found here.
Personal trainer Junaid Dar, has been issued with an 11-year director ban, and self-employed roofer David Michael Godderidge, has been put under bankruptcy restrictions for seven years which means he cannot act as a company director without permission of the courts.
In both cases, the liquidator and trustee in bankruptcy are assessing Dar and Godderidge’s abilities to repay the funds and will take actions if they are able to.
In this case The Insolvency Service have sent a clear message that where fraudulent activity is discovered action will be taken to remove individuals from the corporate arena for a lengthy period of time.
It goes without saying that the use of a BBL must be for the benefit of the business and never for personal use and using a BBL for personal payments can have very severe consequences.
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The information was correct at time of publishing but may now be out of date.