Two businessmen from East Sussex and Essex falsely claimed maximum £50k Bounce Back Loans and used money for their own gain according to an investigation by the Insolvency Service.
Azmi Shafi Ahmed from Grays, Essex, and George David Festivus Pinnegar from East Grinstead have been disqualified for a total of 17 years after each claimed the maximum £50,000 Bounce Back Loans for their businesses and used the money for personal gain.
Ahmed was the sole director of AZ Financials Ltd, trading as a bookkeeper from Ludgate Hill in London. In July 2020 he applied for a £50k Bounce Back Loan for the company, after claiming that its previous year’s turnover had been £200,000.
But the Insolvency Service began an investigation into the director’s conduct after AZ Financials Ltd went into liquidation in November 2022, owing the full amount of the loan.
Investigators found that the company’s turnover in the previous year had in fact been less than £40,000. Ahmed had exaggerated the figures in the loan application by at least five times the true amount, to claim over £40,000 more than the bookkeeper had been entitled to.
They also discovered that three days after the money arrived in the company’s account, Ahmed transferred the full £50,000 to his personal bank account.
Ahmed has now repaid £25,000 to the company’s liquidator, and the remainder will be repaid in June 2023.
Lawrence Zussman, Deputy Head of Company Investigations at the Insolvency Service, said “The Bounce Back Loan scheme was designed to support active businesses through the pandemic. Azmi Ahmed and George Pinnegar exploited this support and abused the public purse for personal gain.”
“These bans show that abuse of taxpayers’ money will not be tolerated, and rogue directors will be prevented from running a business.”
In a separate case, George Pinnegar, sole director of London Sound Engineering Ltd, also applied for a £50,000 loan for his company in July 2020, after claiming the estimated turnover for the previous year to be £250,000. Under the rules of the scheme, if a business began trading after 1 January 2019, its estimated annual turnover could be used to claim a loan.
The business traded as a sound engineering firm from Hammerwood Park in East Grinstead – although the company was listed on Companies House as a temp agency. It went into liquidation in August 2021, still owing the full amount of the loan.
Insolvency Service investigators discovered that the company had filed dormant accounts which showed that London Sound Engineering Ltd had not been actively trading on 1 March 2020 – one of the criteria required to apply for a Bounce Back Loan.
They found that Pinnegar had transferred almost £38,000 of the loan money to his personal bank account over a period of six months. And he paid the remaining £12,000 into the bank account of a connected company.
The company’s liquidator is currently working to recover the funds.
Azmi Ahmed’s 6-year disqualification began on 13th June 2023 and George Pinnegar’s 11-year ban started on 20th June 2023. The bans prevent them from becoming involved in the promotion, formation or management of a company, without the permission of the court.