It appears that The Insolvency Service has been proactive in taking steps against Directors who have fraudulently claimed Bounce Back Loans during the pandemic. To date one Director has received a twelve year disqualification for fraudulently obtaining a Bounce Back Loan and transferring the balance to their personal account whilst taking steps to place the company into Administration.
The Insolvency Service has also taken steps to wind up five companies since February 2021 where loans appear to have been taken fraudulently.
The Insolvency Service will also soon have additional powers to investigate Bounce Back Loan fraud in instances where companies have been dissolved. A Bill being put before Parliament will provide powers to The Insolvency Service to investigate and, if deemed appropriate, take actions to disqualify Directors of companies which have fraudulently claimed Bounce Back Loans but which have since dissolved. Interestingly, this power will be retrospective to allow conduct that took place before the law came into force to be investigated.
It remains to be seen how these new powers will be enforced and whether The Insolvency Service, HM Revenue & Customs and the Banks will have the resources and desire to pursue fraudulent claims. This is likely to be an area that will be subject to many claims and legal challenges over the next few years.
For more information about the RPG incorporating Crawfords Business Recovery team and our insolvency & recovery services which are personalised to suit your needs, please contact Gareth Hunt or another member of the Business Recovery team. Email email@example.com See more details here https://rpg.co.uk/rpg-insolvency/