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Home » News & Insights » Inappropriate use of Bounce Back loans

Inappropriate use of Bounce Back loans

Posted on 3rd November 2021

Three directors have been banned following investigations which found that nearly £100,000 worth of Bounce Back loans had been inappropriately applied for, or misused. 

The Bounce Back Loan scheme ran to March 2021 and provided loans of up £50,000 to help businesses survive the impact of COVID-19.

Cases examined by the Insolvency Service ranged from lack of proper record-keeping to appropriating funds borrowed for personal use rather than supporting a business.

All directors have a duty to ensure their companies maintain proper accounting records. The use of a Bounce Back Loan must be for the benefit of the business and never for personal use. Failure to account for how a Bounce Back Loan was used or using it for personal payments, can result in being disqualified as a director or the extension of bankruptcy restrictions.

Recent cases examined by the Insolvency Service may be the tip of an ever-enlarging iceberg that seeks to bring to task businesses that have secured Bounce-Back loans and misappropriated them in these ways.

Source: Informanagement

MJB Avanti | 08000 388799

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Filed Under: News Tagged With: Bounce back loans, Insolvency

Disclaimer:- The information contained herein is given by way of general guidance only and no action should be taken solely on the basis of the information contained herein. The Avanti Group (UK) Ltd will be pleased to provide further guidance on the issues, and how they might affect you. No liability is accepted by the firm for any action taken without seeking appropriate professional advice

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