In a legal first, a pandemic loan cheat is told to repay the money he pocketed
Builder Marian Ghimpu occupies a unique place in the Covid cheats’ Hall of Shame.
He's become the first person to be hit with a compensation order after lying to get his hands on a £50,000 Bounce Back Loan.
These were meant to help small businesses through lockdown by providing cheap Government-backed loans of 25% of turnover up to £50,000.
Ghimpu claimed that his company, Deea Construct Limited, had a £200,000 turnover. In fact, its accounts for the preceding year showed zero transactions and only a handful of small transactions before that.
The Insolvency Service says that the 58-year-old from Romania who now lives in Croydon, South London, transferred £40,000 of the loan to himself and took the rest out in cash.
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In April 2021 Ghimpu put Deea Construct into liquidation with all the loan outstanding. It had been provided by Santander but like all Bounce Back Loans was 100% underwritten by the Government, so the loser is the taxpayer.
When the liquidator failed to recoup the money the Insolvency Service went to the High Court to seek a compensation order, which was granted by Judge Briggs on July 25.
Ghimpu, who has been banned from being a director for 13 years, was given five weeks to repay the money.
That deadline has passed without the order being satisfied and the Insolvency Service will now be calling in debt collectors.
Government figures show that an estimated £1.1billion has been lost to Bounce Back Loan fraud, which prompts an obvious question – why has it taken so long to get a compensation order against one of the cheats?
The reason seems to be that first the liquidators of the insolvent companies must try to recover the money and only when that process has been exhausted will a case be escalated.
“Abuse of taxpayers’ money will not be tolerated and I am delighted we have secured this compensation order,” said Nina Cassar, deputy head of investigations at the Insolvency Service.
“Where there have been similar cases of abuse by a company director, we will be seeking further compensation orders and disqualifications.”
In a separate case, pizza-shop owner Shawana Hassan has been given a confiscation order after lying to get a Bounce Back Loan.
This differs from a compensation order because it first needed a criminal conviction.
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That took place at Teesside Crown Court in April when Hassan, 39 and from Thornaby in North Yorkshire, was jailed for 13 months for fraudulently obtaining the maximum £50,000 loan for his company Regent Pizzeria Limited.
The Insolvency Service then took action using the Proceeds of Crime Act, the second time it has obtained a confiscation order against a Covid loan scammer. The previous case concerned haulage company boss Kulwinder Singh Sidhu, 58 and from Stanwell, Middlesex.
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