Swindling Leeds scaffolding boss received £100,000 in Covid 'bounce back' loans

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The boss of a scaffolding company illegally obtained £100,000 in loans during the Covid pandemic, a court heard.

Mark Degnan first lied about his firm’s turnover and then illegally applied for the grant cash twice.

He has now been banned from being a company director for the next five years after a judge labelled his actions as “deplorable dishonesty”.

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The 55-year-old was the sole director of MBL Scaffolding Ltd, based in Rothwell, when he took advantage of the loans offered by the Government in 2020 to help companies recover, Leeds Crown Court heard.

It was estimated that 1.5 million “bounce back” loans worth £47 billion were handed out during the pandemic, and have to be repaid within 10 years.

Prosecutor Harry Crowson said that according to records, the turnover of MBL Scaffolding at the end of 2020 was around £69,500, which meant the most he could apply for was around £17,300.

Scaffolding boss Mark Degnan applied for two Covid loans worth £100,000 which his firm was not entitled to. He avoided going to prison after appearing at Leeds Crown Court.Scaffolding boss Mark Degnan applied for two Covid loans worth £100,000 which his firm was not entitled to. He avoided going to prison after appearing at Leeds Crown Court.
Scaffolding boss Mark Degnan applied for two Covid loans worth £100,000 which his firm was not entitled to. He avoided going to prison after appearing at Leeds Crown Court. | Getty / National World

Degnan applied for the maximum £50,000 loan to Lloyds in May 2020, set aside for companies with a turnover of over £500,000.

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Due to the high demand and speed in which they were processed without thorough checks, he was wrongfully given the full amount.

Two months later he applied again to Starling Bank for another £50,000, but omitted that he had already applied previously. Again, the firm was given the full amount.

Degnan, of Wellhams Road, Pontefract, admitted two counts of fraud by false representation. He has no previous convictions.

Mitigating, Sean Smith said that despite the fraudulent activity, the money was used to help keep the business - which employs around a dozen workers - afloat rather than being frivolously spent by Degnan.

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He said there was “genuine remorse” and said it was a “one-off incident in one-off circumstances” that were “never to be repeated”.

He added: “He has had the experience of going through these [court] proceedings and that has been significant.”

Judge Robin Mairs told Degnan: “These loans were abused by many at the cost to the taxpayer.

“There were clear provisions to who was entitled and who was not, and only one loan was allowed. You took out two such loans.

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“You lied, in effect, about your company. You knew full well you already had one loan and your turnover did not entitle you to £50,000. It was a gross exaggeration and you took the money.”

He said at first sight, it looked like Degnan had used to the money for leisure purposes, but on “closer examination it was shown not to be the case”.

This included the hire of a caravan, which transpired to be used by scaffolders working on a job away from the area.

Judge Mairs continued: “If I thought for a moment the money was obtained to be spent on personal expenditure, I would send you to prison immediately for as long as I could.

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“But this company was kept afloat by these bounce back loans. It’s still afloat and still working.”

He said that a “substantial amount” of the money had been paid back already and conceded that the other employees would suffer if Degnan was to be jailed.

He gave him a two-year jail sentence, suspended for two years, and 250 hours of unpaid work.

Degnan was banned from being a director of a company for five years.

According to records at Companies House, Degnan’s role as director of MBL Scaffolding was terminated in December last year.

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