Birmingham scaffolder given 11-year ban for abuse of Covid-19 financial support
David McGuinness, 41, from the Sutton Coldfield area of Birmingham, was the sole Director of MC-Dalt Scaffolding Services Ltd which was formed in 2017 with its registered office at Erdington in Birmingham.
In May 2020, McGuinness applied for and received a £50,000 bounce back loan on behalf of the company. Bounce-back loans were a government scheme to keep businesses afloat during the Covid-19 pandemic, allowing businesses to apply for loans of up to 25% of their 2019 turnover, up to a maximum of £50,000.
As a result, two months later he applied for the business to be wound up, which led to the insolvency administration initiating preliminary proceedings.
Investigators found McGuinness had put the company’s turnover at almost £300,000 when his accounts for 2019 showed turnover of less than £20,000. The company would therefore only have been granted a bounce-back loan of around £4,000.
Instead of using the money from the bounce back loan for the company’s proper use, he instead transferred nearly £15,000 from the company’s account with bank reference ‘Dave’ the day after receiving the funds. A further £35,000 was transferred to various third parties.
In requesting the company’s dissolution, McGuinness was required by law to notify interested parties and creditors, such as a bank with an outstanding loan, within seven days and that failure to comply could result in criminal prosecution. However, he did not follow this advice.
On December 13, 2022, the Secretary of State for Business, Energy and Industrial Strategy accepted a disqualification obligation from David McGuinness after he did not deny that he abused the bounce-back loan scheme by demanding money to which his company was not entitled.
His suspension lasts 11 years and began on January 3, 2023. The disqualification prevents him from engaging directly or indirectly in the promotion, creation or management of any business without court approval.
Peter Smith, deputy chief of bankruptcy investigations at the bankruptcy service, said:
The Bounce Back Loan Scheme was set up to support companies in real need during the pandemic and David McGuinness has clearly abused it by providing false information to his company’s bank.
This lengthy disqualification is a sign that we take such abuse very seriously and will take action to address the misconduct of these directors.
Notes for editors
David McGuinness hails from Sutton Coldfield and was born in April 1981.
MC-Dalt Scaffolding Services Limited (company registration number 10569182).
Disqualification obligations are the administrative equivalent of a disqualification order, but do not involve a court proceeding.
Persons who are subject to a professional prohibition order are subject to a number of restrictions.
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