- Saturday, November 23, 2024
Syed Hussain fraudulently secured a £50,000 Bounce Back Loan in May 2020 and dissolved his company after the funds appeared in his bank account
By: Shajil Kumar
A 24-year-old Asian-origin restaurateur from Derbyshire, who was jailed for misusing a taxpayer-backed loan scheme introduced during the Covid-19 pandemic, has now been ordered to pay more than £36,000.
Syed Hussain, who formerly owned a curry house in Matlock, was in August 2023 jailed for 18 months and banned as a company director for three years after admitting charges of fraud by false representation and an offence under the Companies Act.
Hussain fraudulently secured a £50,000 Bounce Back Loan in May 2020 and dissolved his company Magic of Spice Ltd after the funds appeared in his bank account.
The Derby Crown Court on May 17 ordered Hussain to pay £36,200 during a confiscation hearing. The court gave Hussain three months to pay the money or face an additional 18 months in prison.
Hussain would still owe the full amount ordered in the event he fails to comply and is returned to prison.
When Hussain applied for the loan, he was serving a suspended sentence for breaching fire safety regulations at the former Moja Indian restaurant in Matlock.
Mark Stephens, Chief Investigator at the Insolvency Service, said that Hussain’s failure to notify the bank when he was applying to have his company struck off the register was calculated and pre-planned.
Hussain applied for the maximum permitted £50,000 loan in May 2020, claiming on the application form that the turnover of Magic of Spice was £200,000. He later said he had erred while putting this figure.
Hussain said that he had decided to close down the company, based on Dale Road in Matlock, as it had been struggling for the previous year.
After securing the loan, Hussain transferred £30,000 to two family members who used the money for personal spending.
A further £10,000 was used for personal expenses such as hotels and car hire. No evidence was provided to the Insolvency Service of the money being used for business purposes.
Hussain also made no repayments to the loan despite this being a condition of the scheme.
