A landscape director from Accrington falsely applied for a government loan and lied about his company's turnover, transferring the money into cash for his own benefit.

John Stewart Hughes, 69, of Stone Hey, Huncoat, applied for Clayton Stone Company Limited to obtain a £50,000 Government-backed Bounce Back loan.

The scheme enabled smaller businesses to access finance more quickly during the coronavirus outbreak.

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

Clayton Stone Company Limited was not fully entitled to the scheme, as Hughes provided false information regarding the turnover of the business for 2019.

Hughes also failed to provide evidence that the loan was used in its entirety for the economic benefit of the company, contrary to the terms and conditions of the scheme.

Filed accounts for the year ending in November 2019 showed a total income of £80,232.

Mr Hughes applied for a loan of £50,000, stating that his company's turnover for 2019 was £200,000.

This meant Clayton Stone Company Limited was eligible for the scheme's funding of no more than £20,058 based on the 2019 accounts, with Hughes obtaining £29,942 more funding than the business was entitled to.

On Wednesday, September 9 2020, £50,000 was funded into the Clayton Stone Company Limited bank account.

Prior to receipt of the funding, the bank account held a credit balance of just £76.57.

No trading income was received between receipt of the funding and cessation of trading.

Between 10 September 2020 and 15 September 2020, three payments amounting to £11,000 were made to Mr Hughes.

On 14 September 2020, £26,200 was paid to a third-party company for a motor vehicle.

Cash withdrawals of £9,980 were also made between September 14, 2020, and July 16, 2021.

A notice from the Insolvency Service states: "Mr Hughes has, to date, failed to provide Clayton Stone Company Limited's accounting records to the liquidator or any other evidence to prove that the transactions referred to above were for the economic benefit of the company.

"The bank has submitted a claim for £50,207 in the liquidation proceedings."

He was disqualified from being a company director for 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.”