Taxpayers could lose billions on Covid loans fraud

Taxpayers  could lose £26bn on coronavirus “bounce back” loans due to fraud, the spending watchdog has found.

Gareth Davies, head of the NAO, said: “Unfortunately, the cost to the taxpayer has the potential to be very high, if the estimated losses turn out to be correct.

“Government will need to ensure that robust debt collection and fraud investigation arrangements are in place to minimise the impact of these potential losses to the public purse.”

The department for business, energy and industrial strategy (BEIS) and the British Business Bank (BBB) estimate that “as a result of credit and fraud risks” 35% to 60% of borrowers may default on the loans, the NAO’s report said.