Minister launches harsh assault on leading bank over COVID fraud failures

The former counter-fraud minister of the United Kingdom, who abruptly resigned in January due to the government's "woeful" management of its COVID bounceback loan scheme, has launched a stinging assault on Starling for its ineffectiveness in combating COVID fraud.

Lord Agnew criticised the online bank Starling, claiming it had "operated against the government and taxpayers' interests" and was one of the poorest institutions at avoiding COVID-19 fraud and reporting questionable activities.


Speaking in Westminster Abbey, Lord Agnew said Starling had used the government scheme as a “cost-free marketing exercise”, while it did not take its anti-fraud responsibilities seriously, reports The Times.


“They took this as a god-sent opportunity to swell their balance sheet by a factor of 50 times in barely less than a year with no risk to themselves and 100% risk to the taxpayer,” said Lord Agnew.


He asserted that Starling had been "one of the worst" in assessing turnover claims by borrowers under the COVID-19 bounceback loan programme. As part of the programme, banks issued loans of up to £50,000 that were guaranteed by the government.


Anne Boden, CEO and founder of Starling, stated that she was "startled" by Lord Agnew's remarks and that Starling has been "one of the most aggressive and effective banks in combating fraud."


“The comments about not checking the turnover of businesses or submitting suspicious activity reports are absolutely and utterly wrong and I must ask him to withdraw the statement,” she added.


Lord Agnew is also scheduled to testify against the British government in an effort to uncover the identity of people who profited from the emergency pandemic measures.


Earlier this week, Lord Agnew said at a seminar on fraud that he would back an effort by a campaign organisation to identify COVID-19 recipients.


He criticised the government of "ridiculous defensiveness" in its attempts to retain secret in the COVID-19 programmes, adding that officials used "frivolous arguments" to prevent complete openness.


It is anticipated that fraud losses from the scheme, which supplied 1.6 million taxpayer-backed loans, will exceed £4 billion. Lord Agnew criticised the programme as a "crucial intervention at an unusual period" that was "terribly implemented."


Spotlight on Corruption has called for complete openness after the British Business Bank failed to share details on recipients. Lord Agnew disclosed yesterday that he has chosen to testify before the tribunal, saying that he had been "reluctant" to do so but that "time is running out."


British Business Bank has argued in the past that the present data privacy standards restrict taxpayers from being informed about who profited from loans, since doing so may lead to "informal, vigilante-like behaviour."


In January, Lord Agnew accused the UK Treasury of having "little interest in the repercussions of fraud on our society," adding that "arrogance, indifference, and ignorance" were "freezing the government machine."


After it was discovered that the government had given COVID-19 loans to 1,000 firms who were not trading when the epidemic began, he criticised the administration for making "schoolboy blunders."


Additionally, it was reported that the UK Treasury had written off almost £4 billion in public funds that had been taken by fraudsters via Covid assistance programmes.


According to data published by HM Revenue & Customs, £5.8 billion was taken through Covid assistance services, including furlough and self-employment programmes.


The UK government established a taskforce to return the monies to the public purse. It is thought that scammers returned £500 million to the public purse last year, and the government hopes to collect a further £1 billion by 2023.


According to the Times of London, the Treasury now expects to recover only £1 for every £4 taken from the Exchequer, or just 26% of stolen assets.

By fLEXI tEAM