A London letting agent has been banned from running a company for 11 years after an investigation by the Insolvency Service found that he had repeatedly abused a Government ‘Bounce Back’ loan scheme.
Bounce Back Loans were a Government scheme to help keep businesses afloat during the Covid-19 pandemic. This allowed companies to obtain loans of up to 25 per cent of their 2019 turnover, up to a maximum of £50,000.
Under the rules of the scheme, businesses could only take out one loan, although they were permitted to apply for a top-up if the original loan was less than the maximum to which they were entitled.
Laszlo Szabo, sole director of Letting Base Ltd, first applied for a Bounce Back Loan in October 2020. He said £38,000 was needed to support his business. The company received the loan money the following day.
Five days later he applied for another Bounce Back Loan of £50,000 for Letting Base Ltd, this time from a different bank. And 10 days after that, he applied for a £12,000 top-up to the first Bounce Back Loan, taking the total borrowed through the scheme up to £100,000.
The following day he returned to the second bank, seeking a further top-up of £50,000 to the second Bounce Back Loan. This time the application was rejected.
Letting Base Ltd went into liquidation in January 2022 owing more than £243,000, including the full £100,000 of the Bounce Back Loan money, triggering an investigation by the Insolvency Service.
Investigators discovered that Szabo had made the four separate applications for Bounce Back Loans and top-ups, despite signing a declaration each time confirming it was his only application, and that Letting Base Ltd was entitled to the money he was applying for.
On 21 November 2022 the Secretary of State for Business, Energy and Industrial Strategy accepted a disqualification undertaking from Laszlo Szabo after he did not dispute that he had misused the Bounce Back Loan scheme by claiming money to which his business was not entitled.
His ban lasts for 11 years and began on 12 December 2022. The disqualification prevents him from directly or indirectly becoming involved in the promotion, formation or management of a company, without the permission of the court.
Nina Cassar, Deputy Head of Investigations at the Insolvency Service, said the Bounce Back Loan scheme was set up to support businesses in genuine need during the COVID-19 pandemic.
‘Laszlo Szabo made false declarations to his company’s banks. It entered liquidation having made no repayments towards its Bounce Back Loans, which resulted in a loss of £100,000 of public funds.
‘His blatant and repeat abuse of taxpayer’s money has resulted in a lengthy disqualification, which will serve to safeguard the economy from traders who exploit financial support packages designed to help UK businesses’.
