NCA senior officer warns of “substantial” Covid loan scheme fraud
A senior officer from the National Crime Agency (NCA) has warned MPs about the “substantial amount” of fraud in the emergency loan schemes and said he would have made “different decisions”.
Graeme Biggar, director-general of the agency’s national economic crime centre, which co-ordinates efforts to prevent fraud, told the Treasury select committee that the NCA has been working closely with government.
He said the agency has started a number of investigations and made three arrests last week linked to bounce back loan fraud.
Read more: Banks begin freezing accounts suspected of bounce back loan fraud
While the scheme, which delivers 100 per cent government-backed loans of up to £50,000 to smaller businesses, has deployed more than £43bn to over 1.4 million firms, there have been concerns around fraud and a high level of defaults.
Biggar said the NCA produced an assessment of the serious and organised crime threats with bounce back loans in particular.
Read more: Government urged to use debt collectors to recover bounce back loans
He said that the agency went to the government with its concerns and provided a list of red flag indicators to banks and ever since has been working with the government on other checks and processes that could be put in place to reduce the risk further.
Read more: Lenders warned to expect 60pc of bounce back loans to default
“Ministers then had a pretty hard decision to make about the balance between reducing fraud risk and getting money out the door to people that really urgently need it and those decisions they made seem reasonable to me but inevitably have resulted in significant fraud risk,” Biggar told MPs.
“It’s easy to look back in retrospect but at the time there was a massive urgency to get the money out the door.
“If I was in those seats, I would have made slightly different decisions I am sure but that’s because of the job that I have at the moment but what we have seen is the suspicious activity reports.
“We started seeing banks reporting in large numbers of potential fraud of these schemes, we highlighted that to government…
“We can only look at the more serious cases as indeed will policing. I think as time goes by, we will see there has been a substantial amount of fraud through these schemes.”
