CHEATS

MORE than 450 company directors have been disqualified in a crackdown on covid fraud claims.The Insolvency Service announced that 459 of the 932 disqualifications overall for fraud were related to the coronavirus financial support scheme, introduced during the pandemic to help businesses in lockdown.

This comes after the organisation published its monthly figures, showing more companies in England and Wales entered insolvency during the month than at any point since records started three years ago.

The Insolvency Service reported 2,457 corporate insolvencies last month, up from 1,784 in February, with Tim Symes, a partner in insolvency and restructuring, at Stewarts said: “The latest insolvency statistics are jaw-dropping ”

When it comes to covid financial support, the insolvency service took enforcement action bringing criminal prosecutions against six directors at companies, all of which led to convictions, and even imprisonment.

The government agency highlighted three recent cases where a couple were sent to jail for more than two years each, after being involved in fraudulent applications for bounce back loans.

Bahar Dag had claimed the full £50,000 Bounce Back Loan by stating the company’s turnover was £200,000, despite it being under a quarter of that

In another instance, Jubelur Rohman, was disqualified as a director for 11 years following an investigation into his company’s £50,000 Bounce Back Loan.

Dave Magrath, director of investigation and enforcement at the Insolvency Service, said: “These fraudsters are just the latest to find out that we will not hesitate to take firm action where we uncover such abuse, and this can ultimately result in a jail sentence.

“The purpose of the Bounce Back Loan scheme was to support businesses during the pandemic, but it is clear a minority of company directors chose to maliciously abuse the scheme and defraud the taxpayer. Our team of experts continue to work round-the-clock to bring these criminals to justice.

FOOTNOTE: Kulwinder Singh Sidhu, 58, from Stanwell, has been sentenced to 12 months imprisonment, after pleading guilty to offences under the Companies Act and the Fraud Act, having abused the Bounce Back Loan financial support scheme in 2020.

Sidhu was director of Wavylane Ltd, a haulage company based in Stanwell, and which had been trading since 2010

On 9 June 2020 Sidhu applied for a £50,000 Bounce Back Loan from his bank on behalf of his business. Under the Bounce Back Loan scheme, genuine businesses impacted by the pandemic could take out interest-free taxpayer-backed loans of up to a maximum of £50,000

The loan was paid into the company bank account and on 26 June 2020 Sidhu filed paperwork with Companies House to have the business dissolved, having transferred the funds to his personal bank account within two days of receipt.