A Birmingham scaffolding boss has been banned from running a business for 11 years after fraudulently claiming £50,000 in bounce back covid loan support.
David McGuinness, director of MC-Dalt Scaffolding Services, inflated the company turnover so he could apply for the maximum loan amount. Once he received it, he transferred the money to himself and others.
The 41-year-old from Sutton Coldfield said in his application that the business’s 2019 turnover was £300,000. In reality it was less than £20,000. Under the scheme businesses could apply for 25% of their turnover, meaning McGuinness was only eligible for £4,000.
McGuinness closed the business two months later, which prompted the Insolvency Service to open an investigation.
Disqualification
McGuinness did not dispute he had abused the loan scheme. On 13 December 2022 the secretary of state for business, energy and industrial strategy accepted a disqualification undertaking, banning him from running a business. This will run for 11 years starting from 3 January 2023.
The service is also looking to recover the funds, and reimburse any creditors.
Insolvency Service deputy head of insolvent investigations Peter Smith said: “The Bounce Back Loan Scheme was set up to support businesses in genuine need during the pandemic. David McGuinness clearly abused it by making false declarations to his company’s bank.
“This lengthy disqualification is a sign that we take such abuse extremely seriously and will act to tackle wrongdoing by these directors.”
Investigators found the day after receiving the loan, McGuinness transferred almost £15,000 out of the company’s account using the reference ‘Dave’. An additional £35,000 was transferred to numerous third parties.
When McGuinness closed his firm he was also legally obliged to notify all interested parties and creditors within seven days. He failed to do so, which is a criminal offence.
