MPs have urged the Government to crack down on £4.9bn of Covid loan fraud amid reports that border police have seized suitcases stuffed with cash.
Taxpayers are on the hook for “eye-watering” losses from Covid fraud, the Public Accounts Committee (PAC) said on Wednesday, as it accused the Department for Business, Energy and Industrial Strategy of being “complacent in preventing fraud”.
Separately, The Times revealed that officials at the border have stopped people “carrying large amounts of money suspected [of being] from coronavirus Bounce Back loans”.
The newspaper found multiple examples of recipients using the cash — which was intended to save jobs by preventing businesses from going bust — on personal spending sprees and gambling habits.
The committee has urged the Government to push banks harder to make sure indebted businesses repay overdue Bounce Back loans.
As things stand, banks have little incentive to work hard to get the money back, the MPs said, as lenders can simply use the Government’s 100pc guarantee to claim the cash back from the taxpayer.
Dame Meg Hillier, who chairs the committee, said there is a “lack of urgency” in tackling fraud and non-repayment.
“They are going after the organised crime end of it, but at the risk of letting a lot of others go,” she said, noting that as much as 48pc of the loans may not be repaid.
“They do not seem to be very interested.”
She said an attitude appears to have developed that because the risk of fraud and loss was acknowledged when the schemes were introduced – which was accepted because of the need to get money into businesses as quickly as possible – there is now no need to try to reduce the losses or tackle the faud.
In total £17bn is set to be lost, of which £4.9bn has been put down to fraud.
“This is a lot of money, when you think about the cost of living squeeze. For context , the national insurance increase is going to raise £12bn. This is £17bn which is potentially lost to this. There is a lack of curiosity and urgency to pursue it down,” said Dame Meg.
“This is taxpayers’ money. We want them to be more urgent on it, and learn lessons.”