Man jailed for fraudulently receiving a £50,000 COVID bounce-back loan to help pay back historic £72 million fraud court order

A man has been jailed for 18 months after he fraudulently received a government-backed £50,000 bounce-back loan to help pay back court order fees linked to a historic £72 million pound fraud case.

Gerald Smith, 69, of Southampton Row, London, exploited the bounce back loan that was offered by the government in 2020 to support UK businesses during the Covid-19 pandemic.

The bounce back loan allowed UK business to apply for an interest free and/or low interest loan to a maximum value of £50,000.00 to support the difficult period retailers faced during COVID. The applicant would make an application to one of the nominated lenders and the loan value was guaranteed (backed) by government.

In the case of Gerald Smith, a £50,000 loan was applied for in the name of “Ian Dunbar”, who was listed as being a director of Arcana Solutions Ltd. The loan was subsequently paid out to Arcana Solutions Ltd. and signed via electronic signature by “Ian Dunbar”.

However, it transpired that Ian Dunbar and Gerald Smith were the same person.  City of London Police detectives were able to show  that the money received via the bounce-back loan was being used by Gerald Smith, through IP addresses, email addresses on online invoices and train tickets. This was used to fund a lavish lifestyle of eating at Mayfair restaurants and purchasing designer clothes, Apple products and flights abroad.

Gerald Smith was first arrested in 2022 and questioned where he remained silent throughout all questions put to him.

Detective Inspector Andrea Bakewell, from the fraud operations team at the City of London Police said:

“When many businesses were struggling to keep their head above water during the COVID pandemic, criminals were making use of the financial aid on offer.

“Gerald Smith demonstrated an incredible degree of manipulation, conceit and greed as he exploited the bounce-back loan scheme offered by the government. This level of exploitation during one of the hardest periods this country has ever faced is something we will not tolerate".

Of the £50,000 received, £22,000 was also used to pay for court fees relating to a historic 2006 fraud case that Gerald Smith was involved in.

In 2006, following an investigation by the Serious Fraud Office (SFO), Gerald Smith pled guilty to eight counts of theft and false accounting of over £34 million belonging to company Izodia Plc.

Smith acquired a stake in the firm Izodia through his Jersey based Orb Group where he transferred over £34 million of Izodia Plc cash assets to Jersey, which Smith took it for himself. He received eight years imprisonment.

Following his imprisonment, Smith became the subject of a confiscation order and was ordered to pay £40.956,911.00 within 12 months or face a default eight-year sentence. With interest, the total amount owed by Smith sits at over £72 million.