Government confirms Insolvency Service to take over from NATIS
The Government has confirmed it is shutting down the National Investigation Service (NATIS), which was set up by the previous Government in 2020 to investigate perpetrators of Covid Bounce Back Loan (BBL) fraud, after it failed to catch a sufficient number of fraudsters.
As of summer 2025, such investigations will be conducted by the Insolvency Service.
According to a Government statement, a review of the NATIS contract proved that taxpayers’ money was not being spent efficiently by NATIS.
Their activities since 2020 have cost the taxpayer approximately £35.8 million, resulting in only 14 convictions, with the total amount recovered by the service remaining ‘unclear’.
Business and Trade Minister Gareth Thomas said that the decision to transfer cases to the Insolvency Service will ensure that lost funds from Covid-era fraud are recovered more quickly and effectively, so they can be reinvested into the economy.
The Insolvency Service has a proven track record of effectively tackling fraud and is actively investigating BBL fraud and abuse, with a focus on Directors who may have misused the loans for personal gain.
The Service has powers to investigate potential malpractice in insolvent, dissolved and live companies. This may include serious misconduct, fraud, scams or dishonest practices in the way a company operates.
Directors found to have misused the BBLs can face disqualification and bankruptcy restrictions, which limit their ability to engage in certain financial activities. In severe cases, they may even face criminal charges and potential jail time.
Companies may even face retrospective investigations if they have outstanding BBL debts, even if the company was dissolved without going through formal liquidation.
Roger Isaacs, National Technical Director of NIFA, said: “The amount of money spent on securing just over a dozen convictions is staggering and hard to comprehend.
“I question whether shutting down NATIS and transferring its responsibilities to an already under-resourced Insolvency Service is going to have a significant impact.
“In any event, the focus of the Insolvency Service will be on businesses that have failed, leaving the fraudsters whose companies avoid insolvency free from scrutiny.
“Even if the Insolvency Services manages to use its powers to ban these fraudsters from ever becoming directors in the future, there may well be no recovery of funds for taxpayers and, in my experience, a ban from being a director is an ineffective sanction for hardened fraudsters who tend to continue their unlawful practices with impunity by using shadow directors to act for them.”
Sources: Gov.UK
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