Three people have been arrested after being accused of fraudulently obtaining £145,000 in total from bounce back loans (BBL).
The National Investigation Service (NATIS), assisted by officers from the National Crime Agency, executed search warrants in the Birmingham area regarding the alleged crime.
The NCA said the searches led to the arrest of three people who were taken to a local police station for questioning. All were later released under investigation.
The BBL scheme delivers 100 per cent government-backed loans of up to £50,000 to small businesses hit by Covid-19.
“This is the first of many operations planned by my officers to target the abuse of the BBL scheme,” said Michael Dineen, deputy director of operations at NATIS.
“We will continue the great work seen here, alongside our colleagues from other law enforcement agencies, to catch and prosecute these criminals.”
“These arrests are part of targeted efforts against BBL fraud,” said Rachael Herbert, head of threat at the National Economic Crime Centre (NECC) at the NCA.
“The NECC is providing intelligence to assist multiple partner investigations, and the NCA and others will pursue those serious and organised criminals who seek to exploit the help provided to businesses during a national crisis.”
The BBL scheme has come under scrutiny of late for the potential risk of fraud.
Last month, the National Audit Office warned there is a “very high level” of fraud risk among BBL scheme borrowers which could result in government losses of between £15bn and £26bn.
Business secretary Alok Sharma has previously said that lenders delivering funds under the scheme conduct fraud checks but deploying funds quickly was a priority.
The scheme has been extended from the end of November to 31 January next year.