Fraudster couple sentenced over Covid loan for property firm

The two men from Liverpool secured a £30K Bounce Back Loan before immediately dissolving their business.

covid loans

A landlord couple have been given suspended prison sentences for fraudulently claiming a £30,000 Covid ‘bounce back loan’ before dissolving their property company.

An Insolvency Service investigation found the men claimed the loan, and then closed down their company in an attempt to avoid paying it back.

Matthew Wright and Karl Mathers were directors of Northgate Property Associates Ltd in Liverpool, which was incorporated in August 2013, and was used to collect rental income on a property the pair rented out.

Rules ignored

Wright applied for a loan on behalf of the company in May 2020, and under the rules of the scheme, the money had to be used for the economic benefit of the business.

Investigators discovered that two days after securing the loan, the pair withdrew the full amount from the company bank account. They paid £21,500 into their joint bank account and £7,450 into Wright’s personal account.

And the following day they moved £30,000 from their joint account into Wright’s mother’s bank account.

Yet within six days of first applying for the loan, the pair applied to Companies House to strike Northgate Property Associates from the register.

Matthew Christopher Wright, 54, from Liverpool, was sentenced to 14 months’ imprisonment for fraud and for failing to tell the bank that the business was to be dissolved. The two sentences are to run concurrently, suspended for a period of 18 months.

Karl Thomas Mathers, 50, also from Liverpool, received 10 months in prison, suspended for a period of 18 months.

£29k still owed

When Wright and Mathers were sentenced at Liverpool crown court, almost £29,000 was still owed towards the loan.

Bounce back loans were a scheme to help support businesses through the Covid pandemic. Companies could apply for loans of between £2,000 and £50,000 from the Government’s British Business Bank.

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