Sunderland scaffolder secured Covid business loan he was not entitled to

Thirty-four-year-old Lee Thomas Hobson had been trading as LTH Scaffolding until December 2019, when he gave up the business and began working for a separate company.

But that did not stop him applying for a government-backed Bounce Back Loan of £50,000 in the name of LTH Scaffolding, which he received on May 12 last year.

The money was meant to cover ongoing business costs but was instead used to repay third parties.

Lee Hobson was declared bankrupt on October 16, 2020, but due to his improper application for the Government-backed Bounce Back Loan and the risk he posed to other creditors, the Official Receiver sought to extend his bankruptcy restrictions further.

The terms of his bankruptcy undertaking extend his restrictions for 10 years, which means he is limited to what credit he can access, as well as not being able to act as a company director without the permission of the court.

Offical Receiver Richard Gill said: "Mr Hobson was not entitled to the loan as he had already stopped trading having taken up employment. This money was not used for the purpose it was intended.

"Bounce Back loans are intended to enable businesses to survive the COVID-19 lockdowns and to be used to provide economic benefit for a business.

"It is hoped that this Bankruptcy Restrictions Undertaking will act as a deterrent to others who may wish to abuse the government’s COVID-19 relief schemes."

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