A Manchester businessman has been jailed for two years and four months after fraudulently claiming more than he was entitled to in Bounce Back Loans.
Matloob Hussain received £150,000 by falsifying figures relating to his companies during the pandemic.
As well as a sole-tradership, Hussein was director of Eccles-based Dynasty Group Ltd, a clothing wholesaler, and NA Collection Mcr Ltd, which sold online confectionary from its Manchester base. Two Bounce Back Loan were claimed for each of his three businesses.
Secondary applications
After successfully receiving loans for each of his companies, the 49-year-old then repeated the process and put another extra Bounce Back Loan application in for each business. This is despite companies only being entitled to one Bounce Back Loan each.
Misrepresented figures
On top of this, Hussein then overestimated the turnovers on his second applications of both NA Collection Mcr Ltd and his sole-tradership. This meant that on his second Bounce Back Loans, he received the maximum £50,000 for each.
Previously disqualified
To add to this, it was found that the Manchester businessman was also acting as a director while disqualified. Hussein had been banned as acting as a director in 2021 after a separate investigation into NA Collection Mcr Ltd from the Insolvency Service.
Sentencing
Three counts of fraudulent activity were admitted to, as well as another count of acting as a director while disqualified.
Hussain was sentenced to 28 months in prison.
“Confusion and misinformation”
Senior Client Manager at Forbes Burton, Ben Westoby commented that “we’re seeing more and more instances that The Insolvency Service is coming down hard on those that falsely claimed more than they should on BBLs.
“While in this case, Mr Hussein has admitted to fraudulent activity, there are others that have fallen foul of confusion and misinformation surrounding Bounce Back Loans. For example, many still believe that businesses with Bounce Back Loans cannot be dissolved. It may be true that a BBL can significantly hold up the process, but dissolutions can still go through regardless”.
“Significant loss to the public purse”
Darren Bailey, chief investigator at The Insolvency Service, said that “Matloob Hussain clearly thought that he was above the law and blatantly disregarded the rules of a loan scheme designed to help struggling businesses.
By applying for multiple loans and continuing to act while disqualified, he caused significant loss to the public purse and undermined the insolvency system.”
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