UK Fraudster Ordered to Repay £197,306 After Securing Covid Loans Illegally
In a significant verdict, Zahid Afzal, a man from Haverfordwest, Pembrokeshire, has been ordered to repay over £197,000 following his fraudulent acquisition of Bounce Back Loans intended to support businesses during the pandemic. Afzal abused the scheme by claiming funds for his companies while having already received legitimate support.
Fraudulent Activity Uncovered
Afzal secured a total of £150,000 in Bounce Back Loans, fraudulently applying for three maximum loans of £50,000 each for his mobile phone businesses, Phone Bits Limited and Phones Onn Ltd. He had already received £52,500 in legitimate funding in 2020, which he neglected to disclose in his loan applications.
Evidence presented in court revealed that Afzal falsely stated his companies had not received prior financial support and inflated the turnover of Phones Onn Ltd to secure additional funds. Instead of utilizing the loans for their intended business purposes, he transferred substantial amounts into his personal accounts.
Legal Consequences
At a confiscation hearing held on January 19 at Swansea Crown Court, it was determined that Afzal must repay £197,306 within three months. Failure to do so will result in a two-year prison sentence. Despite his repayments being limited to just over £2,700 since the fraudulent loans were issued, he remains obligated to repay the full amount, even if imprisoned.
Afzal’s fraudulent activities led to a previously issued suspended sentence in June 2025. In addition to his prison sentence, he was assigned 300 hours of unpaid community service.
Insights from the Insolvency Service
Alexander Grierson, Head of Asset Recovery at the Insolvency Service, commented on the case, stressing the importance of addressing fraud related to the Bounce Back Loan Scheme. He indicated that Afzal’s admission about retaining the unlawfully acquired funds simplified the recovery process. Grierson noted that the Insolvency Service is committed to preventing individuals from profiting off their wrongful actions during the pandemic.
Background on Bounce Back Loans
The Bounce Back Loan Scheme was introduced by the UK government to support businesses struggling due to the impact of COVID-19. Under the scheme, companies could apply for loans to help maintain operations during a critical time. Unfortunately, as evidenced by cases like Afzal’s, some have exploited these measures for personal gain.
Afzal’s mobile phone businesses operated multiple kiosks across England and Wales, making his fraudulent activities particularly damaging at a time when legitimate enterprises were struggling for survival.
Source: official statements, news agencies, and public reports.
https://www.gov.uk/government/news/convicted-covid-fraudster-who-ran-mobile-phone-shops-ordered-to-repay-almost-200000
