Bounce back loan fraud

The Bounce Back Loan Scheme was designed to provide financial support to businesses during the COVID-19 pandemic. However, its rapid implementation and lack of stringent checks led to vulnerabilities that allowed for significant fraud.

Common Reasons for Bounce Back Fraud Allegations

Bounce back fraud is based on using deception or false statements to gain an unfair advantage. The main laws governing fraud in England and Wales are the Fraud Act 2006 and the Theft Act 1968.

The most common trigger for an investigation is company liquidation. On liquidation, a liquidator has a duty to consider the conduct of the directors and if he/she spots potential unlawful and/or illegal activity, to report this.

Fraud related to bounce back loans takes many forms, including :

• Ineligibility - applying for a loan when not eligible, often due to inflated turnover figures.

• Fake Business - creating fictitious businesses to obtain loans.

• Impersonation - assuming the identity of another business or person.

• Improper use of funds - where corporate funds have been used for purely personal reasons. Examples include home improvements, holidays, buying vehicles.

Potential Penalties

Penalties for fraud can be severe and may include:

• Fines - substantial financial penalties.

• Director disqualification - prohibition from holding company directorships.

• Imprisonment - potential prison time.

• Compensation Orders - requiring the repayment of fraudulently obtained funds.

Our Services

We provide expert legal representation if you're facing fraud allegations. We can :

• Expert legal advice - guide you through the legal process and protect your rights.

• Identify defences - including evidence of genuine mistakes or lack of intent to defraud.

• Mitigate Penalties

If you're facing a Bounce Back loan fraud investigation or prosecution, don't hesitate to contact our team for immediate assistance.