Sunday 24 January 2021 3:28 pm

Banks claw back fraudulent bounce back loans

High street banks are scrambling to claw back emergency coronavirus loans linked to suspected fraud.

Banks including HSBC, Barclays, Natwest and Lloyds are among those that have started to freeze accounts over fears that government-backed bounce back loans have been obtained fraudulently.

Read more: FSB: banks must ‘step up’ support for new Bounce Back Loan applications

They have reclaimed up to £50,000 from customers, according to the Mail on Sunday.

In a letter to one customer HSBC wrote it had “formally terminated” a loan, and ordered the customer to repay the full amount, the newspaper reported.

The National Crime Agency yesterday announced it had arrested three men working for a London financial institution as part of an investigation into £6m of fraudulent Bounce Back Loans.

Officers arrested two 30-year-olds from Camden and another man, aged 31, from Mitcham.

The fraudulent claims are believed to have been made through the use of false data and documents.

Enquiries are ongoing to establish the true extent of their activity and whether others are involved. 

Gary Cathcart, head of financial investigation at the NCA said: “Ensuring the integrity of the financial sector is a vital part of our work to tackle illicit finance. 

“Professional enablers who use their specialist knowledge to facilitate criminal activity represent a significant threat, and the NCA will continue to work closely with our partners to target anyone involved in fraud.”

Read more: MPs slam government’s ‘woeful’ handling of bounce back loans

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