Defence Solicitors for Bounce Back Loan Fraud Investigation
If you are being investigated for fraud in relation to a Bounce Back Loan you should get legal help immediately. At Lupton Fawcett, we combine our knowledge with the highest levels of client care to provide you with a robust and effective criminal defence service.
Hailed as the saviour of small businesses, the Bounce Back Loan Scheme (BBLS) was intended to help keep organisations afloat during the national lockdowns, and avoid mass insolvencies.
Huge sums of money have been paid out through the scheme, but there are major concerns that the self-certification process and light checks to determine eligibility have led to a major exploitation of the system.
Some estimates are that 1% of all bounce back loan applications were fraudulent, meaning something in the region of at least £400,000,000 of taxpayers money could have been obtained or used illegally. Other estimates put the figure as high as £23bn.
The National Crime Agency and other related authorities are set to focus their full attention on all allegations of wrongdoing, investigating cases across the country with increasing speed and determination.
If you are unsure about your position with regards to your bounce back loan or have become aware of an investigation, you should seek professional help. Whether you could be investigated for fraud, have to repay the money in the future, or if your business has trading difficulties and has to enter a formal insolvency procedure, it is far better to deal with the situation while you still can.
Speak to a professional business crime lawyer at Lupton Fawcett for confidential advice today by calling the number at the top of this page, or by leaving your contact details in the enquiry form and we will call you back.
What are the consequences of bounce back loan fraud?
Government agencies have been very clear that deliberate cases of fraud can expect the full force of the law. They are keen to publicly expose individuals and businesses that have abused the schemes during a time of crisis. Those first to be investigated and prosecuted face significant reputational damage, in addition to criminal penalties.
The National Crime Agency and National Insolvency Service have said they will examine cases of serious and organised crime linked to the scheme, and help banks detect fraudulent applications. The operation is also likely to catch genuine claims with businesses being pressed for evidence in their defence.
If you have any concerns at all about this we recommend you get in touch as soon as possible to discuss your situation, and help you to understand your position more clearly.
The consequences of bounce back loan fraud are serious. The penalties may include a prison sentence, a fine or both.
If you have taken out one or more Bounce Back Loans for your business, believe you may have made an error on the application, or you are facing an investigation for fraud, contact us today for specialist advice.
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What is the bounce back loan?
Attracted by the low barriers to entry, simple application form and attractive terms, and motivated in many cases by genuine fear and high levels of uncertainty, hundreds of small business owners jumped at the opportunity of a lifeline.
In fact, over 1.4 million businesses borrowed almost £45 billion between May 2020 and February 2021.
The scheme allows eligible applicants to borrow up to £50,000 interest free for 12 months and only 2.5% interest per year thereafter for 5 years, with an option to extend the repayment period to 10 years.
It was intended to provide quick and easy access to low cost funding to support a business’s cash flow during these unprecedented times of uncertainty, and prevent mass insolvencies.
However, with such a high approval rate and relatively few checks, many applicants have exposed themselves to risk by intentionally or unintentionally exploiting the opportunity to access cheap money.
With major concerns over the levels of fraud which may be involved in the Bounce Back Loan Scheme, there is likely to be intense scrutiny over the coming months and it is possible that innocent companies may find themselves wrongly under investigation by the Serious Fraud Office.
However misguided an investigation may be, such a thorough examination by the authorities could still involve a great deal of stress, financial costs and potentially damaged reputation for those concerned.
If you find yourself in need of the best criminal defence lawyers to support you during an investigation for Bounce Back Loan Fraud, contact Lupton Fawcett today for a confidential initial consultation.
Misuse of a bounce back loan may result in prosecution for fraud.
Bounce back loan fraud is being estimated at £15-16 billion. On Friday 10 July 2020 the first reports came out in the media of arrests being made in connection with fraudulent applications. The police obtained freezing orders to prevent funds in 10 bank accounts, worth over half a million pounds, being dissipated whilst investigations are ongoing.
As the coronavirus pandemic stretches further into 2021 than perhaps originally anticipated, the spotlight has not yet been fully turned on to the misconduct carried out during the height of the event. However, government agencies have made it clear that they intend to fully investigate all suspected cases of financial crime through the BBLS.
Some examples of common fraudulent activity in relation to the bounce back loans are:
Making multiple applications
Applying for a loan for more than one business that is under common ownership or control could be considered fraud.
Personal use of loan funds
Bounce Back Loans can only be used to support the running of the business. While the decision as to how this is done is left to the directors there are many examples of small business owners using the funds for home improvements or a new car, which is not permitted.
Fraudulent Bounce Back Loan Applications
Bounce back loan fraud may arise when false representations are made on the application. This is an offence under the Fraud Act 2006. Under Section2 of the Act, it is an offence to dishonestly make a false representation in order to make a gain.
Bounce back loan applications are self-certified and have a 100% government backed guarantee. In some cases, estimated revenue figures were acceptable on the application. With limited checks in place to verify the claims made on the application many applicants may have been tempted to exaggerate their figures to receive a higher amount.
It is a criminal offence for directors to carry on trading either with the intent to defraud creditors or for any other fraudulent purposes. If a director does not take action to protect the interests of creditors he or she may be at risk of fraudulent trading or wrongful trading charges.
The UK government suspended the provision of wrongful trading between March and September 2020, but this has now ended and directors can be pursued.
Over 15,000 cases of impersonation fraud were reported in the first half of 2020, representing more than an 80% increase in the same period in the previous year. Clearly not all of these relate to bounce back loans, but there have been several reports of loans being taken out with the knowledge of the named applicant. Using someone else’s name to apply for any kind of loan or credit is known as identity theft, and is a serious crime.
Lupton Fawcett’s team of Business and Financial Crime Solicitors are highly regarded for successfully defending prosecution for all types of fraud offences.
If you fear that mistakes may have been made on your bounce back loan application, you find your company facing HMRC investigation or accused of Furlough Fraud, Lupton Fawcett can provide comprehensive support, specialist legal advice, and skilful representation.
Our team is led by Jeremy Scott who has 25 years’ experience of defending companies, their directors and other senior employees, when facing regulatory criminal investigation or prosecution.
At such a critical time for the reputation and future of you and your business, it is imperative that you choose the right lawyers to advise and represent you. Lupton Fawcett, ranked in The Legal 500 for Regulatory Law, is known for winning cases that other firms would lose.
Part of a nationally recognised full-service law firm, we are able to assemble a multi-disciplinary team to support you through a criminal & regulatory investigation with the utmost care.
We also understand that business has to continue as, so our approach is always highly commercial, putting business continuity at the heart of our advice and representation whenever possible.
Within every area of law, we put your interests first.
Our Bounce Back Fraud Solicitors act regularly for corporate clients across the United Kingdom including Bradford, Birmingham, Hull, Leeds, Liverpool, London, Manchester, Sheffield, York, and Nottingham.
We can support your needs wherever you live in England, Wales and Northern Ireland.
We will always respond promptly, and we will be happy to help.