HMRC are checking the eligibility of businesses who claimed Bounce Back Loans and prosecuting anyone they feel has taken one fraudulently. There have been a number of cases recently, that I feel should have been more high profile ...
One case shows international criminals claiming over £10 million in Bounce Back Loans via multiple shell companies using the funds in a massive money-laundering scheme. Cash eventually ended up in sports bags in the back of an Audi being delivered around the country. The two men behind the scheme were surveilled and prosecuted then received 33 years of jail time between them.
Another case highlighted a small business going after a local government contract using the Bounce Back Loan to inflate their financial resources which was discovered during due diligence before the contract was awarded. Again this was considered fraudulent by the local government department and the case was referred to the CPS.
A Treasury spokesman recently said: "Our Bounce Back Loan Schemes were designed to keep businesses running during a difficult time and we've been clear that the loans must be repaid and banks are undertaking appropriate precautions against fraud, including customer checks and the monitoring of transactions. Any fraudulent applications can be criminally prosecuted."
Some of my clients' businesses took a Bounce Back Loan, just in case, then never used it and I advised them to repay it in its entirety rather than just sit on the money. Thankfully they all have because there was a remote possibility that they could be subject to a future investigation as they didn't really need it in the first place.
However, as the Government guaranteed 100% of the loans, and a great number of companies have either gone bust and been unable to repay, or directors simply 'phoenixed' the old companies into new ones to avoid repayments, HMRC and the Treasury have said they are taking Bounce Back Loan fraud very seriously, and we can expect many more prosecutions to be in the news soon.
My advice? If you can repay it in full now, then do so. If you can't, make sure you keep up with your repayments and don't mess your loan provider around.
If you feel inspired to find out more about anything I've said here, do call me on 01908 774320 or leave a comment below and I'll be in touch as soon as I can.