Licence refusal for possible Bounce Back Loan fraud upheld

The refusal of a bid for an O-Licence by James Kilpatrick after he obtained a Bounce Back Loan when possibly not entitled to do so has been upheld by the Upper Tribunal

The refusal of a bid for a one-vehicle international O-Licence by Leven-based James Kilpatrick, trading as Kilpatrick Coach Hire, by Traffic Commissioner (TC) Claire Gilmore after he obtained a Bounce Back Loan when possibly not entitled to do so, has been upheld by the Upper Tribunal on appeal.

The TC considered the application at a Public Inquiry because of Mr Kilpatrick’s adverse O-Licensing history, going back to 1998.

In her decision, the TC said that she did not consider it a coincidence that, had Mr Kilpatrick applied for the Bounce Back Loan under the trading name of Phoenix Tours (that being a business established prior to 1 January 2019), he would have had to provide details of his actual turnover.

In relation to the probable profitability of Phoenix Travel, it was unlikely that Mr Kilpatrick would have been able to establish any basis upon which he would have been entitled to a Bounce Back Loan.

The TC considered that Mr Kilpatrick had purported to create a new business entity solely for the purpose of applying for the Bounce Back Loan.

As of 1 March 2020, Kilpatrick Coach Hire was not an existing business which had lost revenue as a result of the pandemic.

It was not, therefore, entitled to receive a Bounce Back Loan. The TC found Mr Kilpatrick’s claims that he believed he had done nothing wrong in applying for the loan to be wholly incredible.

She suspected that he, full in the knowledge that his existing sole trader business did not have sufficient turnover to justify the grant of a Bounce Back Loan, invented a new business and banked on no-one properly checking that he met the criteria in a system where estimates were accepted and little due diligence was being carried out.

He based his projected turnover figure on the operation of a single-vehicle business which already had the benefit of an O-Licence, well in advance of submitting any application for a licence, against a backdrop of significant adverse findings and warnings of the hurdles he would face in seeking to have any future application granted.

Dismissing the appeal, the Tribunal said that in his written grounds of appeal, Mr Kilpatrick stated that he had no recollection of having lost his repute or having been disqualified for five years.

However, he withdrew those assertions at the appeal hearing.

The Tribunal could find no fault either with the TC’s reasoning, or her fact finding on the issues in the case.

It could not accept Mr Kilpatrick’s submission that the TC attached too much weight to his adverse history in O-Licensing.

His more recent conduct regarding the loan was consistent with his past behaviour, and he had shown himself to be an unreformed character who could not be trusted to operate compliantly within the regulatory regime.