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Barclays launches hunt for Covid loan fraudsters: Lender asks courts to shut down about 97 businesses
Barclays has taken first steps to recover Covid loans distributed to suspected fraudsters.
The lender has asked the courts to close at least 97 businesses in recent months.
Bounce Back Loans (BBLs) were available to small businesses and were 100 percent guaranteed by the government. Lenders handed out £47 billion under the scheme.
Pandemic fraud: Barclays has asked courts to shut down at least 97 businesses in recent months
But earlier this year it emerged that lenders had flagged £1.1 billion as suspected fraud.
The final figure remains unclear as the Department for Business estimates it to be closer to £4.9 billion. Barclays has identified a potential £259 million fraud so far.
The Mail on Sunday revealed in June how the bank planned to use legal proceedings to shut down companies suspected of fraudulent loans before transferring business to a firm specializing in insolvency.
It is clear that the recent legal proceedings are the first step in this process.
A spokesperson for Barclays said: “In certain circumstances, including where there appears to be a misuse of funds, formal recovery measures can be taken to recover taxpayers’ money.”