Recruitment consultant sentenced after fraudulently using Covid loans

A Recruitment consultant has been handed a suspended sentence. after fraudulently using Covid loans for personal purposes after an Insolvency Service investigation.

Rico Iheagwara secured two Bounce Back Loans worth £20,000 each from different banks for his Essex-based SJR Recruitment Limited company when businesses were only entitled to a single loan under the scheme.

Iheagwara was sentenced to 18 months in prison, suspended for 18 months, for fraud when he appeared at St Albans Crown Court on Friday 16 May.

He was also ordered to complete 120 hours of unpaid work and 15 days of rehabilitation activity.

SJR Recruitment was incorporated in January 2017 with Iheagwara as its sole director. The company’s registered office address was on High Road in Loughton.

Iheagwara was also the sole signatory on both company bank accounts, which were opened in May 2020, just one month before his first fraudulent application. For both applications, made in June and July 2020, Iheagwara claimed the company’s turnover was £82,000.

Iheagwara transferred the first £20,000 loan into his personal account on the same day he received the funds. For the second loan, he moved all £20,000 into his personal account the following day.

None of the £40,000 was used for the economic benefit of his business. Insolvency Service analysis of bank statements suggested that the funds were used for everyday expenses and paid to various family members. In interviews, Iheagwara said he spent the funds on rent, paying off personal finance and supporting his children.

SJR Recruitment went into liquidation in April 2021. No repayments were made on the loans. The Insolvency Service is seeking to recover the fraudulently obtained funds under the Proceeds of Crime Act 2002.

David Snasdell, Chief Investigator at the Insolvency Service, said “Rico Iheagwara blatantly abused a taxpayer-backed scheme designed to support genuine small businesses through the pandemic. He knew he was not entitled to support yet continued with his fraudulent applications nonetheless.

“Iheagwara’s business was not trading at the time of his application so he was not entitled to a single penny from the scheme, let alone the £40,000 he fraudulently secured.

“Tackling Covid support scheme abuse remains a key priority for the Insolvency Service and we will not hesitate to prosecute fraudsters such as Iheagwara who stole from the public purse during a national emergency.”