How big of a problem is COVID-19 fraud?

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How big of a problem is COVID-19 fraud?

Coronavirus support schemes are due to finish over the next few months, there is no doubt that they have provided a lifeline for businesses but there has been some that have ‘bent the rules’ or committed outright fraud.
According to HMRC, the estimated current value of CJRS-related fraud or ‘error’ could be as high as £3.5bn.

Examples of coronavirus-related fraud include:

• Adding non-existent staff to the payroll (known as ‘ghost’ employees).
• Non-operational businesses claiming for bounce back loans.
• Asking employees who have been furloughed to continue working.
• Using Bounce Back Loans to fund private purchases.
• Third-sector organisations putting staff on furlough then asking them to ‘volunteer’.
• Transferring government grants and loans to private accounts.
• Impersonating a company to take out bounce back loans.
Accountants who know their client’s businesses well will be able to spot ‘errors’ and will need to advise their clients to inform HRMC. Accountants are professionals and need to maintain an ethical standard, which means making sure their clients don’t get into hot water with HMRC!

#covidfraud #accountants #standards

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