As we start another week, here is an overview of another person, once a Company Director, who is starting an 11-year ban today for BBL wrongdoing.
On 11 July 2020, Abid Jabbar (‘Mr Jabbar’) caused Linkz Enterprises Ltd (“Linkz”) to apply for a Government backed Bounce Back Loan (“BBL”) totalling £49,500 to which it was not entitled by providing false or knowingly inaccurate information concerning Linkz’ turnover.
Mr Jabbar has failed ensure that the loan was used in its entirety for the economic benefit of the business contrary to the terms and conditions of the scheme.
In that:
- The BBL Scheme enabled a business to obtain a BBL of up to 25% of a business’s turnover (for the calendar year 2019) up to a maximum amount of £50,000.
- Where a business was established after 1 January 2019, the applicant was required to apply a 25% limit to the estimated annual turnover from the date they started the business;
- Linkz was incorporated on 18 April 2011
- On 11 July 2020 Mr Jabbar applied for a BBL for Linkz of £49,500 with Bank A, declaring an annual turnover of £210,000
- The BBL of £49,500 was deposited into Linkz’s bank account on 21 July 2020
- The Company’s accounts for the year ending 30 June 2019 show that Linkz’s turnover for the year ending 30 June 2019 was £9,527.
- Company accounts for the year ending 30 June 2020 show that turnover in the year was nil.
- No further accounts were filed; Mr Jabbar stated that he applied for the BBL using an estimated turnover figure.
- As the company was established prior to 2019 he should have applied using Linkz’s actual turnover for 2019.
- Given the turnover for 2019 was no more than £9,527, the maximum BBL to which the Company was entitled was £2,381
- By using an estimated turnover in the application for a BBL, Mr Jabbar caused the Company to obtain £47,119 more than it was entitled to.
- It was a requirement of the BBL scheme that the loan be used solely for the economic benefit of the applicant company
- The BBL of £49,500 was deposited into Linkz’s bank account on 21 July 2020.
- The balance on the account was £20 prior to the receipt of the BBL; Contrary to the terms of the scheme, £47,957 was paid from Linkz’s bank account to Mr Jabbar between 22 July 2020 and 27 August 2020
- No evidence has been provided to demonstrate that the loan funds were used for the economic benefit of Linkz;
- No repayments have been made in respect of the BBL and Linkz’s bank are owed £50,116 at liquidation in respect of the BBL.
- The only other creditor at liquidation was Mr Jabbar who claimed to be owed £500.
