Coventry man hit with seven-year business ban for bounce back loan abuse - The Coventry Observer

Coventry man hit with seven-year business ban for bounce back loan abuse

Coventry Editorial 13th Jan, 2023 Updated: 13th Jan, 2023   0

A COVENTRY man has been disqualified as a director for seven years after wrongfully taking out a £45,000 bounce back loan on behalf of his charity in October 2020.

Darren Baker, who was director and chair of The Leanne Baker Trust, then secured a further £5,000 top-up for the charity in March 2021.

The Leanne Baker Trust was set up in 2014 to support people struggling with their mental health through campaigns, but it went into liquidation in September 2021.

Charities were eligible to apply for bounce back loans during the pandemic, however, the Leanne Baker Trust had no overheads or employees.

Baker claimed the charity had a £200,000 turnover to secure the loan, yet its annual accounts showed a maximum turnover of £26,029 for the 2019 calendar year.

The charity was therefore ineligible for the funding.

After receiving the funding, Baker used over £25,000 to pay off personal legal fees, and a further £13,000 for personal use.

The misuse of the bounce back loan was reported to the Insolvency Service by the liquidator who subsequently recovered the full amount.

Baker accepted he caused The Leanne Baker Trust to obtain a Bounce Back Loan it wasn’t entitled to, and the Secretary of State for Business, Energy and Industrial Strategy, Grant Shapps accepted a disqualification undertaking from him.

The disqualification undertaking prevents him from directly, or indirectly, becoming involved in the promotion, formation or management of a company, without the courts’ permission.

Rob Clarke, Chief Investigator at the Insolvency Service, said:”Bounce Back Loans were offered to businesses that had been negatively impacted by the pandemic, with the money purely to be utilised for the economic benefit of those companies; safeguarding jobs and sustaining entrepreneurial activity.

“That clearly was not the case in this instance where the funds have been claimed by a charitable enterprise, with negligible turnover, and no employees.

“Despite the humanitarian purpose of the trust as established, Darren Baker took advantage of the support available during this difficult time for his own personal gain.

“His disqualification should serve as a warning to others that the Insolvency Service will take action whenever a director’s dishonesty threatens loss to the public purse, the consequence being a lengthy exclusion from trading with the benefit of limited liability.”


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