a day ago
- Business
- Western Telegraph
Pembrokeshire company director sentenced for fraud during Covid
Mr Zahid Afzal of Haverfordwest fraudulently claimed extra Covid bounce back loans for his phone sales and merchandise companies.
When appearing at Swansea Crown Court on Thursday, June 12, Mr Afzal was sentenced for three counts of fraud by false representation and was handed a two-year suspended sentence, and 300 hours of unpaid work.
Insolvency Service Chief Investigator David Snasdell said: 'It is clear from our investigations that Zahid Afzal felt he could continue to apply time and time again for loans he was not entitled to.
'Not satisfied with the substantial funds he had legitimately received, he went on to lie on applications and exaggerate his companies' turnovers.
'His sentencing should serve as a reminder to those contemplating fraudulently pocketing taxpayers' money to think again.'
The director of Phone Bits Ltd and Phones Onn Ltd had already received Covid loans for both companies legitimately – totalling £52,500 – when he applied for three more.
The 37-year-old, from Haverfordwest, falsely claimed the applications were the first he had made and exaggerated the turnover of each company.
He then received three additional loans of £50,000 each – one for Phone Bits Ltd and two for Phones Onn Ltd – between May and November 2020.
The Insolvency Service investigation did not find any wrongdoing with the use of his initial loans for Phones Onn Ltd (£20,000) and Phone Bits (£32,500), which he was entitled to and were used entirely for business purposes.
But he moved most of the £150,000 he received from his second round of loans to personal accounts despite stating they were for business purposes.
The Bounce Back loan scheme helped small and medium-sized businesses to borrow between £2,000 and £50,000, at a low interest rate, guaranteed by the Government.
The loans were made on the condition that they were not to be used for personal purposes, but could be used, for example, to purchase a company asset such as a vehicle, if it would provide an economic benefit to the business.
The money lent to a company had to be paid back, over six or 10 years, with payments starting 12 months after the company received the loan.
The Insolvency Service is seeking to recover the fraudulently obtained funds under the Proceeds of Crime Act 2002.
