John Gerard McGarvey, 37, from Rutherglen, has been disqualified after claiming two separate Bounce Back Loans totalling £100,000 and then using the money for personal benefit.
McGarvey was the sole director of CKO Civil Engineering and Surveying Limited, which was incorporated in October 2019 and ran as a surveyor’s firm based in Kirkintilloch in Scotland until it went into liquidation in November 2021.
CKO applied for a Bounce Back Loan of £50,000 in July 2020, with Mr McGarvey stating the company had a previous year’s turnover of £225,000.
Bounce Back Loans were government-backed loans introduced to support businesses through the pandemic. Under the rules of the scheme, companies could apply for loans of up to 25 per cent of their 2019 turnover, allowing them to borrow from £2,000 to a maximum of £50,000 as long as the money was to be used for the economic benefit of the business.
Businesses were not allowed to apply for an additional loan unless they had originally borrowed less than the maximum amount.
But CKO applied for a second Bounce Back Loan of £50,000 just four weeks later in August 2020. This time Mr McGarvey applied to a different bank and stated that the business had a previous year’s turnover of £218,000.
The company struggled to survive post-COVID-19 and went into liquidation owing around £183,000, which triggered an investigation by the Insolvency Service.
Investigators discovered that Mr McGarvey had applied for two loans — which was against the rules of the scheme — and had exaggerated CKO’s turnover both times. The company’s most recent accounts showed a turnover of only around £46,400.
They also discovered that Mr McGarvey had used the full £100,000 for his own gain, rather than to support his business.
The Secretary of State accepted a disqualification undertaking from Mr McGarvey after he did not dispute he caused CKO to receive two Bounce Back Loans totalling £100,000 to which the business wasn’t entitled and then used money for his personal benefit, rather than for the economic benefit of the business.
His disqualification started on 28 October this year and lasts for 11 years.
The disqualification undertaking prevents Mr McGarvey from directly or indirectly, becoming involved in the promotion, formation, or management of a company, without the permission of the court.
