MPs told 37% of bounce back loans could be fraudulent

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MPs have been told by a Public Accounts Committee (PAC) that over a third of bounce back loans (BBLs) issued during the pandemic are likely to have been made fraudulently.

The National Audit Office (NAO) estimates that £4.9bn has already been lost to fraudulent activities and a further £17bn is unlikely to ever be repaid, although these estimates are considered to still be ‘highly uncertain,’ according to the Secretary for Business, Energy & Industrial Strategy (BEIS) Sarah Munby.

The MPs criticised the panel for not safeguarding against fraud originally in the form of checks.  Craig Mackinlay MP accused the senior officials on the panel of a ‘casual approach’ to how much money had been potentially lost through the scheme.  He continued by saying that it wasn’t justified by the panel declaring that they ‘knew there was possibly going to be a high level of fraud with the scheme when we launched them’.

The British Business Bank (BBB) concluded by stating that the panel would have been in a ‘better position to identify and prevent fraud’ had they received funding to improve its IT years ago and therefore ‘greatly improve’ its computing capabilities.

If you have any accounting or tax queries, please call Ellis & Co Chartered Accountants in Chester on 01244 343 504.