Not the longest of bans handed out for BBL wrongdoing, but as you will see in the following case, there are reasons for the 6 year bans handed out to the Company Directors named.
6 Year Disqualification
On 04 May 2020, Cornelius Kleynhans (“Mr Kleynhans”) allowed Western Isles Insulation Ltd (“Western”) to breach the conditions of the Bounce Back Loan (BBL) Scheme by applying for a Bounce Back Loan of £50,000.00 which Western was not entitled to.
In that:
- Western lost its principal client in June 2019.
- Western filed application to strike off with Companies House on 28 August 2019 Western’s accountant confirmed Western ceased trading on 31 August 2019 and deregistered for Value added Tax.
- Between 1 September 2019 to 4 May 2020 no trading income is received into Western’s bank account.
- On 27 March 2020 Western filed notice to revoke its strike off application with Companies House.
- On 11 April 2020 Western made an application for the Coronavirus Business Interruption Loan Scheme.
- The application was denied due to having no trading activity through business account and being unable to demonstrate affordability.
- Under the BBL scheme businesses could apply for a loan of between £2,000 and £50,000 subject to a maximum of up to 25% of turnover.
- To be eligible, businesses were required to be engaged in trading or commercial activity in the UK at the date of the application, carrying on business on 1 March 2020 and be adversely affected by coronavirus.
- On 4 May 2020 Western applied for a BBL of £50,000.
- On 5 May 2020 Western receives £50,000. Between 5 May 2020 and winding up order on 8 December 2020, no trading income is received into Western’s bank account.
- Between 19 May 2020 and 15 October 2020 transfers of £41,073 are made to connected companies
- At liquidation Western had creditors totalling, £281,030, including the full amount of the BBL.
Between 14 May 2020 and 15 October 2020 Mr Kleynhans allowed Western to make transactions totalling £41,073 to the detriment of Western’s general body of creditors:
- At 14 May 2020, Western had no assets and owed at least £281,087 to creditors, 4 of whom had obtained judgment from October 2019 at the latest to recover their debts totalling £14,418.
- On 5 May 2020 Western received a BBL and between 14 May 2020 and 15 October 2020 payments of £41,073 were made to connected companies.
- No trading income was received in this period.
- A Winding up petition was issued on 30 September 2020.
- £950 of the payments to connected parties were made after the petition was issued.
At liquidation Western had creditors totalling at least, £281,030, including the full amount of the BBL.
6 Year Disqualification
On 04 May 2020, Mark David Friend (“Mr Friend”) allowed Western Isles Insulation Ltd (“Western”) to breach the conditions of the Bounce Back Loan (BBL) Scheme by applying for a Bounce Back Loan of £50,000.00 which Western was not entitled to.
In that:
- Western lost its principal client in June 2019.
- Western filed application to strike off with Companies House on 28 August 2019
- Western’s accountant confirmed Western ceased trading on 31 August 2019 and deregistered for Value added Tax.
- Between 1 September 2019 to 4 May 2020 no trading income is received into Western’s bank account.
- On 27 March 2020 Western filed notice to revoke its strike off application with Companies House.
- On 11 April 2020 Western made an application for the Coronavirus Business Interruption Loan Scheme.
- The application was denied due to having no trading activity through business account and being unable to demonstrate affordability.
- Under the BBL scheme businesses could apply for a loan of between £2,000 and £50,000 subject to a maximum of up to 25% of turnover.
- To be eligible, businesses were required to be engaged in trading or commercial activity in the UK at the date of the application, carrying on business on 1 March 2020 and be adversely affected by coronavirus.
- On 4 May 2020 Western applied for a BBL of £50,000.
- On 5 May 2020 Western receives £50,000.
- Between 5 May 2020 and winding up order on 8 December 2020, no trading income is received into Westerns bank account.
- Between 19 May 2020 and 15 October 2020 transfers of £41,073 are made to connected companies
- At liquidation Western had creditors totalling, £281,030, including the full amount of the BBL.
Between 14 May 2020 and 15 October 2020 Mr Friend allowed Western to make transactions totalling £41,073 to the detriment of Western’s general body of creditors:
- At 14 May 2020, Western had no assets and owed at least £281,087 to creditors, 4 of whom had obtained judgment from October 2019 at the latest to recover their debts totalling £14,418.
- On 5 May 2020 Western received a BBL and between 14 May 2020 and 15 October 2020 payments of £41,073 were made to connected companies. No trading income was received in this period.
- A Winding up petition was issued on 30 September 2020.
- £950 of the payments to connected parties were made after the petition was issued.
At liquidation Western had creditors totalling at least, £281,030, including the full amount of the BBL.
