Last week, the Government launched ‘The Fraud Squad.’ Sounds a bit like a blockbuster movie…but it’s actually a serious venture led by Chancellor Rishi Sunak. Initially, the primary objective is to investigate the billions the Government lost through fraud that took place during the height of the pandemic.
Experts claim that company directors lost, squandered, or smuggled out of Britain £4.9billion worth of Government loans. A new Public Sector Fraud Authority (set to launch in July), will support Sunak’s specialist team of fraud investigators.
Of course, what we are referring to is the Government’s infamous Bounce Back Loan (BBL) scheme. Based on their self-declared turnover, small to medium-sized businesses could apply for a lockdown support loan of up to £50,000.
Sunak’s Fraud Squad
The Government offered BBLs at a fixed rate of 2.5 per cent with repayments scheduled over six years. However, inevitably, serious abuse of these loans took place. Interestingly, companies that formed after the pandemic began obtained at least £100 million in loans.
Additionally, many directors immediately transferred funds to their personal bank accounts, which is a serious act of misconduct. It would have been impossible to vet each application due to the high volume during the peak of the chaos. Many company directors took advantage of this.
Recover stolen money
Sunak’s Fraud Squad will recruit data analytics experts and economic crime investigators to identify suspicious companies and recover stolen money. Sunak said this week:
“We will chase down fraudsters who rip off the taxpayer. This elite fraud squad, backed by £25 million, will ensure the latest counter fraud techniques are being used to track down these criminals.”
Clearly some people viewed the Bounce Back Loans as an opportunity to gain some free money.
It is important to remember that hardworking taxpayers pay for Bounce Back Loans. Rightly so, any attempt to defraud the public purse should come with hefty consequences, including criminal prosecution. We shall keep our eyes peeled for how the Fraud Squad progress.