Bounce Back Loan Fraud Lands London Restaurateur in Jail
Posted by Emma on 8th Jan 2025
A London-based restaurant owner has been ordered to repay £37,426 within three months after fraudulently obtaining a Covid Bounce Back Loan. The court ruled that failure to comply would result in an additional 18 months being added to his two-and-a-half-year prison sentence.
Ilhan Kekec, 36, secured a £30,000 loan in May 2020 by overstating the turnover of his company, Hizirali Ltd, which operated a kebab restaurant in Forest Gate. Kekec falsely claimed the business had a turnover of £125,000. In reality, the restaurant had only traded for three weeks before the first Covid-19 lockdown, leaving it unable to open during the pandemic.
After withdrawing the loan money in cash, Kekec admitted to investigators that the funds were used to clear personal debts rather than for the economic benefit of the business, as required under the loan terms. By June 2020, he had applied to dissolve the company, citing financial challenges, but had failed to inform creditors of this action as legally required.
Kekec was convicted of two counts of fraud and two counts of failing to notify creditors about the voluntary dissolution of his business. In March 2024, he was sentenced to two-and-a-half years in prison. At a confiscation hearing in December, the court ordered him to repay the loan amount in full, along with accrued interest, or face a longer jail term. Kekec was also ordered to pay £15,900 in legal costs and has been banned from acting as a company director for three years.
Alexander Grierson, Head of Asset Recovery at the Insolvency Service, commented:
“Ilhan Kekec not only supplied false information to fraudulently acquire taxpayer funds but also misused the loan for personal gain. These loans were intended to support struggling businesses during the pandemic, not to clear personal debts. Securing this confiscation order ensures accountability and recovery of public funds.”
Hizirali Ltd was established to operate Derwish Kebab Restaurant at the East Shopping Centre in Forest Gate, London. Before this venture, Kekec operated another restaurant in Watford under a different company. However, his attempt to expand proved ill-timed as the pandemic struck shortly after opening.
In addition to his jail sentence, Kekec’s fraudulent actions have highlighted the broader challenges of enforcing compliance in emergency loan schemes. The Bounce Back Loan Scheme was designed to financially relieve small businesses during the pandemic. However, cases like Kekec’s highlight vulnerabilities in the system and the need for robust measures to prevent misuse.