Nathanael Thomas Ballard was charged with dishonestly and without claim of right applying for Small Business Cashflow Scheme loans (SBCS) and a Resurgence Support Payment (RSP). He was sentenced in the Te Awamutu District Court on 27 November to 8-and-a-half month’s home detention.
Ballard was listed as a director of Pure Quality Services Ltd (PQSL) when it was incorporated in September 2016 but stopped that role in January 2017. He had ‘owner’ access to the company’s myIR account and didn’t cancel it when he stopped being a director. He also had a myIR account in his own name.
In April 2020, the Government announced the ‘high trust’ Small Business Cashflow Scheme to support small business which were adversely affected by the COVID-19 pandemic.
In May 2020, Ballard applied for an $11,800 SBCS loan in his own name which was approved and paid out. He knew he wasn’t entitled to the money because he didn’t have an existing and viable business.
Two days later he repeated the application procedure this time for $19,000 using the company name. He was caught out when PQSL’s current director told IR Ballard had applied for and received the money without his knowledge or consent.
In February 2021, Ballard tried to make a claim for the Resurgence Support Payment falsely stating he had been in business for 6 months and that the business was viable and ongoing. IR declined the application.
The total paid out by IR was $30,800, and the total Ballard was unsuccessful in obtaining was $1,732.
Since June 2022, Inland Revenue has been conducting a review of some customers who received one or more of the RSP, SBCS and the COVID-19 Support payment to make sure customers met the eligibility criteria and used the payments within the terms and conditions.
So far, Inland Revenue has successfully prosecuted eight customers, including Nathanael Ballard, for SBCS fraud involving $7,789,073.00.
There are 23 other cases before the courts involving $778,569. Four people are awaiting sentencing after pleading guilty.
Customers identified for SBCS fraud have also been fraudulent across other COVID-19 products and taxes and involved other government agencies.
There is one case being run by the Serious Fraud Office involving an approx. $2.1 million fraud of the wage subsidy scheme (run by the Ministry of Social Development) plus SBCS & GST fraud (run by IRD).
The SBCS loan scheme closes at the end of December. Applications are still coming in and Inland Revenue continues to see applications being made and is still identifying fraud in some of those applications.