BRITAIN said on Wednesday (27) it will set up a new authority to crack down on financial frauds as chancellor of exchequer Rishi Sunak admitted that the government’s pandemic assistance schemes were abused.
The announcement comes amid a series of reports that economic offenders milked the government’s low-interest loan scheme at the height of Covid-19 and even attempted to smuggle money out of the UK.
While a third of the £47-billion bounce-back loan scheme, aimed at providing businesses with access to liquidity, is unlikely to be recovered, more than 10 per cent of the total amount is suspected to be lost to frauds.
“We will chase down fraudsters who rip off the taxpayer,” Sunak said as he outlined the functioning of the new Public Sector Fraud Authority, which will be operational by “July this year”.
He said the anti-fraud squad, backed by £25 million in funding, will have data analytics experts and economic crime investigators to recover money “stolen from Covid support schemes”.
It will spot suspicious companies and people seeking state contracts, the government said, adding that the counter-fraud experts will also mount mandatory inspections on Whitehall programmes to uncover vulnerabilities.
While there are several cases of the loans being misused, The Times said border control officials foiled many bids to smuggle cash out of the country.
“Border force officials have stopped people at airports across Britain carrying large amounts of money suspected from coronavirus bounce-back loans”, the newspaper said, citing a Home Office source.
Investigations are ongoing.
While the purpose of the bounce-back loan scheme was to prop up the businesses which risked collapse amid the pandemic, the report said some beneficiaries splurged the money on even gambling, cars and watches.