The British Business Bank has appointed accountancy firm PriceWaterhouseCoopers to investigate possible cases of fraud with the Covid-19 business loan schemes.

The loan programs were brought in to help support SME’s financially who have been impacted by the Covid-19 pandemic.

A spokesperson from the British Business Bank has said, “We have recently appointed PwC as consultants to provide further insight into where fraud is being committed or attempted, helping to identify where further resources are required as well as enabling additional fraud-prevention measures to be put in place.”

A letter from the British Business Banks CEO, Catherine Lewis La Torre started that up to now 26,933 fraudulent loan applications had been detected, valued at over £1.1. billion.

There have been widespread reports that fraud has been committed on an industrial scale through the pandemic. In 2020 alone, there had been 33,000 reports filed reporting fraudulent furlough claims and loan applications.

Jonathan Fisher QC at Bright Line law has been quoted to say, many of the cases likely relate to government furlough and loan schemes, and could be schemes like fictitious businesses claiming furlough for non-existent staff.
Fisher said the figure showed that the government schemes are being abused, “they have offered an opportunity for fraud, and the criminals have taken it…you can read into this that the government systems are not as strong at preventing fraud as they should be.”

The latest figures from HMRC suggest that up to 10 percent of the £39 billion handed out date has been claimed fraudulently.

We have had many enquiries over the past few months from worried business owners who are concerned that they are not going to be able to pay back their Bounce Back Loans when they become due. As long as you were entitled to apply for a Bounce Back Loan and have spent the money as per the terms of the BBL then you can liquidate the company and the BBL will be classed as an unsecured debt and you won’t be pursued personally for it.

If you have any questions about Bounce Back Loans or are concerned about the impact they may have on your business we advise you to seek professional help early if you would like a confidential chat about the options available to the company please let me know.

Thanks,

Chris

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I'm Chris Worden, Managing Director at 1st Business Rescue. With over 7 years of experience, I help UK directors navigate the complex world of UK corporate insolvency. We offer free and independent advice to UK directors and advise them about what options may be available to them if their limited company starts to struggle. I am passionate about helping other directors overcome their business challenges and get back on their feet, as I was once in the same position as them. I had a business that became insolvent, and the advice out there was confusing and overwhelming. I am here to provide honest and valuable advice to UK directors.  I am proud to say that we are one of the only 5-star corporate insolvency companies on Trustpilot with hundreds of 5-star reviews, and we publish videos weekly on our YouTube channel. Our channel is designed to educate UK directors about insolvency and debt advice. Check it out here:

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