A business director from Burnley falsely applied for a Government loan knowing the company was ineligible for such funding.

As a result, Michael Burns has been disqualified from being the director of a company for the next 10 years.

Burns, 27, of Briercliffe Road, Burnley, applied for MBurns Automotive Ltd to receive a £20,000 Bounce Back Loan (BBL).

The Insolvency Service said Mr Burns then applied for an additional £7,000 of BBL funds when he “knew or ought to have known” the company did not meet the criteria and was not entitled to any funds from the scheme.

The scheme helped small and medium-sized businesses to borrow between £2,000 and up to 25 per cent of their turnover, with the maximum loan available being £50,000.

The turnover figure required was that for the calendar year 2019 or where a business was established after January 1, 2019, it is their estimated turnover from when the business started.

As per the BBL eligibility criteria, a business had to be established and actively trading at March 1, 2020 – MBurns Automotive was incorporated on October 28, 2019.

READ MORE: Accrington director falsely applied for £50k 'Bounce Back' loan

Companies House records also show the company filed dormant accounts for the year ending October 31, 2020, which indicates it was not actively trading on March 1, 2020.

The first BBL payment of £20,000 was paid into the company’s bank account on November 11, 2020, ad the second payment of £7,000 into the same account on February 2, 2021.

At liquidation on July 25, 2022, the BBL provider was the only company creditor with £27,420 outstanding.

The disqualification, which came into force on March 13, bars Burns from being the director of a company for the next 10 years.

Peter Fulham, chief investigator of the criminal investigation team at the Insolvency Service said: "Covid-19 financial support schemes were funded from the public purse to support genuine businesses during the pandemic.

"Directors who abused the scheme have exploited taxpayers.

“The Insolvency Service will act to remove directors who abused Bounce Back Loans from the business arena.”