Birmingham fraudster jailed after lying to secure Covid business loans
A fraudster from Birmingham lied about his business’s turnover to con the Government and taxpayers out of thousands in Covid loans.
Faruk Chowdhury, of Churchill Road in Bordesley Green, was director of Learn & Earn Ltd, registered at Earl Street in Maidstone, Kent.
He claimed it had a turnover of £150,000 when applying for a Government Bounce Back Loan.
He received an initial £35,000 in late 2020 and a £2,500 top-up in early 2021.
He said the money would be used to support his business but instead used the cash to pay off his own debts.
Chowdhury was only given the cash because he lied about much his company, Learn & Earn Ltd, was turning over, the Insolvency Service said.
The 45-year-old was given a 22-month prison sentence, suspended for two years, at Birmingham Crown Court on Tuesday, July 28, for two counts of fraud by misrepresentation.
He was also ordered to carry out 250 hours of unpaid work.
David Snasdell, Chief Investigator at the Insolvency Service, said: “Chowdhury cynically exploited a government scheme designed to support legitimate businesses through an unprecedented crisis.
“He made false declarations about his company’s turnover and business activities, knowing full well that the funds would be used to settle his personal debts rather than support any genuine trading.
“Bounce Back Loans were a vital lifeline for small businesses during the pandemic, and those who abused the scheme undermined public confidence in government support.
“The Insolvency Service remains committed to investigating and prosecuting those who fraudulently obtained the loans, and work to recover the stolen funds.”
Chowdhury was the sole director of Learn & Earn Ltd, which was established in February 2020, just weeks before the pandemic officially began.
The company described its trading on Companies House as ‘repair of computers and peripheral equipment’.
In December 2020, Chowdhury secured the £35,000 Bounce Back Loan from a bank, fraudulently claiming his business had a turnover of £150,000 and that the funds would be used for business purposes.
Within days of receiving the loan, he transferred £25,000 to his personal bank account, with the remaining £10,000 following in early January 2021.
Chowdhury obtained a £2,500 top-up to the loan in February 2021, providing the same turnover figure of £150,000 and again falsely declaring the money would be used for business purposes.
The £2,500 was transferred to his personal account within days.
Chowdhury claimed in interviews the company had generated income and that he had used the funds to buy computer equipment and pay himself as the sole employee.
He alleged his business had been impacted by the pandemic and that he needed the loans to secure premises and consolidate his personal debts due to a poor credit rating.
But banking records showed no genuine trading activity, no payments to any computer supplier, and the company never filed accounts or submitted tax returns.
Learn & Earn Ltd entered liquidation in April 2021 and Chowdhury was disqualified as a director for nine years in January 2022 as a result of his misconduct at the company.
The Insolvency Service said it is seeking to recover the fraudulently obtained funds under the Proceeds of Crime Act 2002.
Deputy Editor
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