James Ireri, 44, from Surrey, has been banned for seven years after abusing two different Covid loan schemes during the pandemic.
Ireri was the director of Safi Care Ltd, which traded as a recruitment business from Surrey, supplying staff to care homes, from its incorporation in February 2015 until it went into liquidation in August 2021. The company had first traded as Safi Services Ltd until March 2016.
In May 2020, Ireri applied for a £50,000 Bounce Back Loan - the maximum amount allowable - for the company.
Bounce Back Loans were a government scheme to support businesses during the COVID-19 pandemic, whereby companies could apply for loans of up to 25% of their 2019 turnover, up to a maximum of £50,000.
Yet in August 2020, Ireri applied for another loan of £100,000 on behalf of Safi Care Ltd, this time from a different lender, and through a different Covid support scheme, the Coronavirus Business Interruption Loan.
Under the rules of the Covid loan schemes, eligible businesses were able to apply for a single loan under one or the other of the schemes, but not both. However, a business could obtain a second loan if the money was used to repay the first in full.
But when Safi Care Ltd went into liquidation in August 2021, the company owed more than £231,500, including the full amount of both loans.
An investigation by the Insolvency Service was triggered, but Ireri failed to provide adequate company accounts and investigators were unable to determine whether Safi Care Ltd had ever been eligible to apply for the initial Bounce Back Loan, based on the company's 2019 turnover.
The lack of company books also meant that Ireri was unable to prove that he had used the loan money for the economic support of the business - another condition of the scheme.
Investigators discovered that more than £491,300 had been withdrawn from the company bank account between May 2020, when the first loan was received, and July 2021, shortly before Safi Care went into liquidation, including more than £80,000 for personal spending and around £93,900 of transfers into Ireri's personal bank accounts.
The Secretary of State accepted a disqualification undertaking from James Ireri after he did not dispute he had caused Safi Care Limited to breach the terms of two Covid Support loans by failing to repay the Bounce Back Loan after obtaining the Interruption Loan, and by failing to provide adequate evidence of the company's turnover or how the loan funds were used.
His ban started on 8 December 2022, and lasts for seven years. The disqualification prevents him from directly or indirectly becoming involved in the promotion, formation or management of a company, without the permission of the court.
Neil North, Deputy Head of Investigation at the Insolvency Service, said:
"Bounce Back Loans and Covid Business Interruption Loans were designed to provide vital support for viable businesses through the pandemic. James Ireri abused not one, but two of these schemes.
"His ban should serve as a warning to other directors who misuse financial support available to companies that the Insolvency Service is able to bring your actions to account and remove you from the corporate arena."
Notes
James Ireri is of Surrey and his date of birth is May 1978
Company Safi Care Ltd (Company Reg no. 09431442).
Disqualification undertakings are the administrative equivalent of a disqualification order but do not involve court proceedings.
Persons subject to a disqualification order are bound by a range of restrictions.
