Insolvency Service tackles further Bounce Back Loan abusers
The Insolvency Service has taken a tough stance in two recent cases where Bounce Back Loans have been abused.
In separate applications, Junaid Dar (31), from Birmingham, and David Michael Godderidge (40), from Tamworth, falsely applied for close to £60,000 from the Bounce Back Loan scheme, which was set up to support businesses during the pandemic.
Junaid Dar’s company, JDarPT Ltd, entered into liquidation in July 2021, prompting the Insolvency to investigate his conduct. Investigators found that Dar legitimately applied for a Bounce Bank Loan after submitting accurate financial statements and in May 2020, received £13,000.
However, it was also uncovered that Dar applied for additional loans from two separate financial institutions. His company received a further £32,500 in total in loans which it was not entitled to.
Junaid Dar is now banned from running companies for 11 years, effective from 27 April 2022.
In a second case, self employed roofer David Godderidge, applied for his own bankruptcy in October 2021. While assessing David Godderidge’s assets to make payments to his creditors, the Official Receiver uncovered in September 2020 that he had provided incorrect information to obtain a Bounce Back Loan far greater than he was entitled to.
Godderidge had instructed a third party to make the loan application on his behalf using inflated turnover figures before spending the £13,000 Bounce Back Loan on gambling over a period of just 3 weeks.
The Official Receiver sought to extend David Godderidge’s bankruptcy restrictions due to the risk he posed to other creditors. His bankruptcy undertaking extends his restrictions for 7 years and means he is limited to what credit he can access. In addition he cannot act as a company director without the permission of the court.
In both cases, the Liquidator and Trustee in bankruptcy are assessing Junaid Dar and David Godderidge’s abilities to repay the funds and will pursue if they have the means.