A London company director has been jailed for more than two years after falsifying turnover figures to fraudulently obtain three bounce back loans totalling £130,000. Investigators found that the company never traded, and the individual used the taxpayer-funded Covid relief to finance personal business dealings overseas.
A London-based company director has been sentenced to more than two years in prison for fraudulently securing multiple Covid-19 bounce back loans after inventing turnover figures for a business that had never traded. The case serves as a strong reminder of the government’s ongoing efforts to investigate and prosecute misuse of taxpayer-funded pandemic support schemes.
According to the Insolvency Service, the individual behind a logistics company based in Bethnal Green fabricated turnover figures as high as £375,000 to obtain three separate bounce back loans worth a total of £130,000. The company, however, had only been incorporated in February 2020 and never conducted any genuine business activities.
The fraudulent applications began in May 2020, when the director first claimed a turnover of £120,000 to secure a £30,000 loan on the very day the scheme opened. Just over a week later, he applied to another bank for a £50,000 loan using a new turnover figure of £275,000, and two months later, he repeated the process with a third lender, this time inflating turnover to £375,000.
Because each application was made through a different bank, the institutions were unaware that multiple loans were being claimed for the same business—something strictly prohibited under the terms of the bounce back loan scheme. When interviewed by investigators, the individual admitted that the figures were entirely made up, stating that he “didn’t really put much emphasis into thinking about the figures” and had simply fabricated them.
More than £40,000 of the fraudulently obtained funds was later used to finance a business operation overseas, sending goods from the UK to West Africa for resale. The profits from these sales were reportedly brought back to the UK in cash.
At the Old Bailey, the director pleaded guilty to charges of fraud and money laundering and was sentenced to two years and two months in prison. The court also disqualified him from acting as a company director for five years. The company itself is currently in the process of being struck off by Companies House.
An Insolvency Service spokesperson commented that the case demonstrates the continued determination to pursue those who exploited pandemic support schemes for personal gain, regardless of how much time has passed since Covid-19. The agency reaffirmed its commitment to holding fraudsters accountable and protecting public funds.
Fraudulent claims under Covid support schemes remain a major focus for HMRC and the Insolvency Service, with many similar investigations still ongoing. Businesses are reminded that all financial support claims must be based on accurate, verifiable information, and misuse can lead to severe legal consequences.
Get in touch with Naail & Co for tailored advice on compliance, company governance, and financial reporting to ensure your business stays on the right side of the law.
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