A property management firm owner from Glasgow has been disqualified as a director for 12 years, after using his companies to take out Bounce Back Loans (BBL) totalling £135,000 that they were not eligible for.
Brendan Michael Gaughan, 40, ran three separate property management companies - Gaughan Group, Gaughan Property and Rentl Property - which were only incorporated in February 2020 and did no business until April 2020.
As a result, they were not eligible for funds through the BBL scheme, which was available only to firms that had been doing business on 1 March 2020.
However in May 2020, Gaughan Group received a BBL of £50,000, Gaughan Property received a BBL also of £50,000, and Rentl Property received a BBL of £35,000.
Gaughan transferred all the funds into a single account and proceeded to use the money to buy a property worth nearly £160,000 in August 2020. He then sold the property in March 2021 for just over £140,000, and on the same day transferred £100,000 of the proceeds to his personal account.
All three companies were put into liquidation on 11 October 2021, which triggered an investigation by the Insolvency Service.
The Secretary of State accepted disqualification undertakings from Gaughan, after he did not dispute that none of his companies had been eligible for the loans. His ban is effective from 27 October.
The disqualification undertakings prevent him from directly, or indirectly, becoming involved in the promotion, formation or management of a company, without the permission of the court.
Steven McGinty, investigation manager at the Insolvency Service, said: "Bounce Back Loans were made available for trading companies adversely affected by the pandemic.
"Brendan Gaughan should have known his companies weren’t entitled to the loans yet he took them anyway and used the funds for personal gain.
"We will not hesitate to take action against directors who have abused Covid-19 financial support like this."
Disqualification undertakings are the administrative equivalent of a disqualification order, but do not involve court proceedings.
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