Bounce back loan fraud
The bounce back loan scheme (BBLS) was created by chancellor Rishi Sunak to help medium and small businesses to survive unprecedented tough times due to the coronavirus pandemic. The scheme offers a fixed rate of up to 25% of your turnover between £2,000 and £50,000 and interest-free for the first 12 months and thereafter a 2.5% interest P.A. The scheme aims to provide essential financial backup to businesses affected by COVID-19. Lately, several business owners have inadvertently walked into problems and risked prosecution for fraud following charges of money laundering and Bounce Back Loan Fraud with multiple fake companies and bank accounts being frozen.
Things to consider when opting for Bounce Back Loan Scheme;
· BBLS is a debt and not a grant. Only one application is allowed per group. Not more than one business under common ownership should apply.
· At the time of application, the business must not be subject to debt relief order, company voluntary agreement, or facing liquidation.
· The firm must not be a beneficiary of CBILS (Coronavirus Business Interruption Loan Scheme), CLBILS (Coronavirus Large Business Interruption Loan Scheme), or CCFF (COVID-19 Corporate Financing Facility) unless refinancing in full with BBLS.
· The loan is purely for trading purposes as an alternative funding source within the UK. Ascertain whether any other source of funding will require any form of security during the lifetime of the BBLS.
What qualifies as Bounce Back Loan Fraud?
· When the loan is taken out and used to fund personal endeavors like supercars, deposit on properties, purchase of premium goods, and expansion of the business rather than survival of the existing venture.
· Insolvent companies using the cash to pay back personal loans and borrow money from the company. Cases where shareholders routinely use the company bank account as an extension of their personal bank account.
· Dormant companies using the loan to raise cash at low rates and company directors borrowing with no intention of repaying and putting the money into fixed assets.
Do you think you may have acted improperly with Bounce Back Loan funds? All is not lost, Phoenix Recovery can help you undo decisions you may have taken in unprecedented times. There are many avenues available to you to correct any misappropriation of Bounce Back Loan funds legally and correctly.