Increased Investigations into Bounce Back Loan Fraud
In May 2025, the UK Government announced that they would be transferring the caseload for investigating bounce back loan (BBL) fraud from the National Investigation Service to the Insolvency Service. This shift aims to implement a more aggressive and targeted strategy to accelerate the recovery of these fraudulently obtained funds.
Since this development, there has been an increased number of criminal investigations into BBL fraud. To date, the Insolvency Service has reportedly obtained disqualifications against over 2000 directors and secured over 60 criminal convictions in relation to BBL fraud.
An accusation of bounce back loan fraud is not to be taken likely. As the loans were made available during a time of national emergency, misuse of these funds is considered extremely serious and can result in severe penalties.
If you are facing an allegation of BBL fraud, it’s important to contact a team of specialist solicitors immediately. At Lawtons, we have secured outstanding results for clients facing BBL fraud charges. Our experienced team can help you understand the charges against you and formulate a robust defence to minimise the potential penalties.
What are Bounce Back Loans?
DEFINITION
Bounce Back Loans
Bounce Back Loans (BBLs) are a government-backed scheme created to financially support small and medium-sized businesses during the COVID-19 pandemic.
The scheme was launched in May 2020 and allowed businesses to borrow between £2000-£50,000. To apply for these loans, interested parties simply had to fill out an application form declaring that their business was eligible to receive funds.
Since businesses were able to self-declare their eligibility to receive these loans, the scheme was extremely vulnerable to fraud.
What constitutes Bounce Back Loan Fraud?
Bounce Back Loan fraud refers to when BBL funds were either obtained fraudulently and/or misused in a fraudulent manner.
Examples of BBL fraud can include:
- If an application for a BBL was made and obtained for a company which was not eligible e.g. the company’s annual turnover was inflated to maximise the loan allowance
- If a fake business was created in order to apply for funds
- If a legitimate business or person was impersonated in order to apply for funds
- If loans were applied for via multiple lenders, therefore exceeding the limit of one loan per person
- If loans were used for personal use rather than business use
What are the penalties for Bounce Back Loan fraud?
Currently, there are no set sentencing guidelines for BBL fraud. Sentencing has largely been based on recent case law, for example the recent Court of Appeal decision in the case of R V Dagistan [2023] EWCA Crim 636. This case set out guidance that cases of BBL fraud should be considered with higher culpability and therefore immediate prison sentences considered in appropriate cases.
Based on recent convictions, penalties can include:
- Large fines
- Disqualification as director
- Imprisonment
- Confiscation orders (where law enforcements seize assets acquired using fraudulently obtained funds)
- Compensation orders (where individuals are required to repay money lost to the company due to their misconduct)
- Serious Crime Prevention Orders (SCPOs – imposed to prevent individuals from engaging in further criminal activity)
How can Lawtons’ Bounce Back Loan Fraud solicitors help you?
Being accused of bounce back loan fraud is a serious matter and can result in a lengthy prison sentence, as well as other potentially severe penalties. Without help from an experienced defence solicitor, you are at risk of facing a harsh and long-lasting sentence.
With a wealth of experience, Lawtons are here to guide you through this difficult situation. We are dedicated to ensuring our clients receive the best possible outcome, while minimising the long-term consequences on their future.
If you or someone you know is currently being investigated for bounce back loan fraud, it is important to act quickly. Please do not hesitate – get in touch with a member of our specialist team to talk through the details of your case and find out how we can help you.
