Mathius Thompson, 33, from Birmingham; Moira Wood, 47, from Lightwater, Guildford; and Ioan Adrian Mociar, 35, from Harrow have been banned for a total of 30 years after separate investigations found they had abused the Bounce Back Loan scheme during the COVID-19 pandemic.
Mr Thompson was the sole director of West Midz Cars Ltd in Ladywood, Birmingham. In May 2020, he applied for a Bounce Back loan of £50,000 for his used car dealership.
Bounce Back Loans were a government scheme to help keep businesses afloat during the COVID-19 pandemic. Under the rules of the scheme, companies could apply for loans of up to 25 per cent of their 2019 turnover up to a maximum of £50,000. All loan money had to be used for the economic benefit of the business.
Mr Thompson stated in his loan application that the dealership’s turnover for 2019 was around £287,500 and received the maximum £50,000 loan for the company. But the business went into liquidation in August 2021 owing £53,500 including the full amount of the Bounce Back Loan, which triggered an investigation by the Insolvency Service.
Investigators discovered that West Midz Cars Ltd’s turnover in 2019 had been just over £2,500 and the company’s bank statements for that year showed no income or trading activity, meaning the business had not been entitled to a loan.
The company accounts also showed no evidence that the money had been used for the economic benefit of West Midz Cars. A compensation order of £50,000 is now being sought to repay the loan provider.
Ms Wood, who was the sole director of her IT consultancy, Clockwork Compliance Services Ltd, in Guildford, Surrey, applied for a £24,000 Bounce Back Loan for her company in September 2020. The business went into liquidation in February 2022, owing £55,800 including the full amount of the loan and triggering an Insolvency Service investigation.
Investigators discovered that Ms Wood had transferred £23,400 to herself between October 2020 and January 2022 just before the company folded with no evidence that the money had been used for the benefit of Clockwork Compliance Services.
And Mr Mociar, who was sole director of Midi Construction Ltd in Pinner, Harrow applied for a £41,000 Bounce Back Loan for his building company after stating on the application that the business’ turnover in 2019 had been £166,000. Under the rules of the scheme, if a business began trading after 1 January 2019, the estimated annual turnover could be used.
When Midi Construction Ltd went into liquidation in December 2021 with debts of around £46,000 including the full amount of the loan and almost £5,000 owed to HMRC, it triggered an investigation by the Insolvency Service.
Investigators found that as the building company had only begun trading in June 2019, accounts showed that its turnover for the year ended 31 May 2020 was around £45,500. Midi Construction had therefore received around £29,600 more than it was entitled to under the rules of the loan scheme.
They also discovered that payments of more than £39,700 had been made from Midi Construction Ltd’s bank account during a three-week period between October and November 2020 without any evidence to show that they were for the economic benefit of the company.
The Secretary of State for Business, Energy and Industrial Strategy accepted disqualification undertakings from the three directors after they did not dispute that they had caused their companies to either:
- Provide misleading information to a bank to obtain a Bounce Back Loan when they knew or ought to have known that their business was not eligible for a loan of the amount claimed
- And/or not provide evidence to show that payments from the company bank accounts were used for the economic benefit of the company
Mr Mociar’s disqualification runs for 11 years from 6 January 2023. Ms Wood is banned for eight years from 30 January 2023 and Mathius Thompson is banned for 11 years, also from 30 Jan 2023.
The disqualifications prevent them from directly or indirectly becoming involved in the promotion, formation, or management of a company without the permission of the court.
Tom Phillips, assistant director of company investigations at the Insolvency Service, said: “The Bounce Back Loan scheme was designed to support businesses in genuine need. These three company directors abused taxpayers’ money to either apply for loans to which they weren’t entitled, or by failing to show that the money they claimed had been used to support their companies.
They have been removed from the corporate arena for a total of 30 years, and their disqualifications should serve as a reminder to others that the Insolvency Service will take action to protect the public and the taxpayer.”
West Midz Cars Ltd traded as a used car salesroom at Great Tindal St, Ladywood from its incorporation in January 2016 until it went into liquidation in August 2021.
Clockwork Compliance Ltd traded as an IT consultancy firm in Guildford from its incorporation in January 2018 until it went into liquidation in February 2022.
Midi Construction Ltd traded as a building company in Pinner, Harrow from its corporation in May 2019 until it went into liquidation in December 2021.
