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Bounce Back Loan Scheme: Fraud

Question for Department for Business, Energy and Industrial Strategy

UIN 151086, tabled on 31 March 2022

To ask the Secretary of State for Business, Energy and Industrial Strategy, whether he has allocated resources to recover the money lost to fraud as part of the Bounce Back Loan Scheme; and what his planned timeframe is for recovering those funds.

Answered on

19 April 2022

BEIS is committed to recovering money from fraudulent applications under the Bounce Back Loan Scheme (BBLS) as soon as reasonably practicable given the nature and stage of the scheme. We seek recoveries in numerous ways.

Lenders are responsible for undertaking recovery action once it becomes due in the first instance, whether fraud or otherwise.

Whilst lenders are the first line of defence, the National Intelligence Service (NATIS) supplements our capacity to investigate the most serious cases of fraud. In the current financial year, NATIS (for all matters including BBLS) has already recovered over £3 million. HM Treasury has also recently announced an additional £13.2m for NATIS which will double their investigative capacity on Bounce Back Loans.

The enforcement strategy also includes utilising Insolvency Service (INSS) resource to investigate misconduct in relation to insolvency and corporate abuse which, like NATIS, is designed to drive recoveries and set a deterrent to those who intend to abuse the scheme. For cases arising out of Bounce Back Loan abuse this includes director disqualification, bankruptcy restrictions, winding up companies operating against the public interest and criminal prosecution.

We are also taking steps to prevent companies attempting to dissolve with an outstanding BBL by blocking such applications, forcing companies to use legitimate liquidation processes thus improving recovery prospects.

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