Bounce back loan fraud is unacceptable, say MPs

The Department for Business Energy and Industrial Strategy (BEIS) was ‘complacent in preventing fraud’ in the 100% taxpayer-guaranteed bounce back loan scheme says the House of Commons’ Public Accounts Committee in a new report. Further the government should not ‘just accept’ this level of unpaid debt calling it ‘unacceptable’ that the department ‘has no long-term plans for recovering overdue debt’.

In its December 2020 report on the scheme the committee warned that the design of the scheme had ‘exposed the taxpayer to potentially huge losses’ and despite inconsistent data latest estimates show that of £47bn paid out in bounce back loans £17bn is already expected to be lost £4.9bn of that to fraud.

The focus on delivery of the loans ‘at breakneck speed’ meant lenders were not required to do credit or affordability checks...