LONDON (Reuters) – The value of suspected fraud in securing government-backed COVID-19 emergency loans has increased by 43% to 1.69 billion pounds ($2.11 billion), British government figures published on Thursday showed.
Banks doled out around 77 billion pounds ($96 billion) of government-backed finance to help struggling companies cope in COVID-19 lockdowns, but levels of potential fraud across the hastily put-together schemes have attracted scrutiny.
The latest figures from the Department for Business and Trade showed the level of suspected fraud as of June 30. The figure was up from the previous level of 1.18 billion pounds flagged at the end of March.
Identified fraud levels have ticked up as banks look into further COVID-19 loans as they fall due.
The government’s guarantees cover the bulk of the value of the COVID-19 loans, putting taxpayers on the hook for a potentially large bill and allowing banks to claim for unpaid loans if certain conditions are met.
The figures show the government has paid out 7.39 billion pounds to lenders to date under the guarantees, while 17 billion pounds has been fully repaid by borrowers.
Nearly 31 billion pounds’ worth of loans are outstanding from borrowers still making payments on time, the data shows.
($1 = 0.8007 pounds)
($1 = 0.8012 pounds)
(Reporting by Iain Withers; Editing by Angus MacSwan)