In a blatant abuse of the Covid Bounce Back Loans scheme, 37-year-old Jagoda Rubaszko falsely claimed a £50,000 loan by inventing a non-existent business and then siphoned the funds to accounts in Poland. She falsely declared an annual turnover of £210,000, and HMRC approved her application two days later. Investigators then found no such business existed. Instead, Rubaszko transferred the loan funds to five men in Poland.
She told officials that a man named Daniel coached her through the application. Rubaszko claimed he advised her to declare bankruptcy to avoid repayment. She provided no evidence of Daniel’s existence or guidance. Bank records showed 22 transfers to Polish accounts over a two-month period. None went to anyone named “Daniel.”
The Insolvency Service uncovered the scam after routine checks. They flagged her high turnover claim and probed her account history. When they dug deeper, no invoices or trading evidence surfaced. Investigators linked the scam to organised crime groups operating abroad. They now seek to recover the stolen funds through civil recovery orders.
Details of the Scheme
The Covid Bounce Back Loans scheme began in May 2020. It aimed to help small businesses survive pandemic lockdowns. Companies and sole traders could borrow up to £50,000. The government guaranteed 100% of each loan. Borrowers had to start repayment within 12 months. They then had up to ten years to repay in full.
The scheme proved vital for many genuine businesses. It offered quick access to funds when banks slowed lending. Yet criminals saw an opportunity in the fast-track process. They exploited minimal identity checks and automated approvals. Fraud teams warned of rising abuse as early as mid-2020. The National Audit Office later estimated that over £4 billion in fraudulent loans had been made across the UK.
Rubaszko’s case illustrates this weak link. She used false documents and invented turnover figures. She then sent the money overseas. These actions drained vital covid support away from legitimate firms. Her scam formed part of a wider pattern that cost taxpayers millions.
Court Case and Suspended Sentence
Rubaszko first appeared at Isleworth Crown Court in March 2025. She pleaded guilty to one count of fraud by false representation. On 5 June 2025, Judge Peter Bacon delivered the sentence. She received 18 months’ imprisonment, suspended for 21 months. The court added 175 hours of community service. She must observe a tagged curfew from 7:30 pm to 6 am.
The suspended sentence means Rubaszko avoids jail unless she commits another offence. She must also pay back the full £50,000 through a legal recovery process. The Insolvency Service confirmed it will pursue her assets to recoup the money. Rubaszko remains under Bankruptcy Restrictions until 2033. This restriction bars her from acting as a company director.
Despite the scale of the scam, the court accepted mitigating factors. Her defence highlighted health issues and lack of prior convictions. Judge Bacon noted Rubaszko’s remorse and steps towards rehabilitation. However, he also warned that suspended sentences carry real risk. Any breach of the order will trigger immediate custody.
Lenient Sentence Again
The case once again shows how offenders can escape prison for major scams. Many view the sentence as a slap on the wrist. Social media users expressed anger over the suspended term. One commenter wrote, “She stole tens of thousands. She should face real jail time.” Others pointed out that genuine business owners faced delays and stress during the loan approval process.
Legal experts also criticised the outcome. Criminal barrister Sarah Patel said: “A suspended sentence for a £50,000 fraud sends the wrong message. It fails to deter others who see chance for easy gains.” She added that tougher guidelines are needed to reflect the gravity of pandemic loan abuse.
A poll by Policy Exchange last year found that 72 per cent of the public support immediate custodial sentences for Covid loan fraud. Many feel the justice system treats white-collar crime too leniently. They fear this approach undermines trust in both courts and government support schemes.
Impact on Public Trust and Crime
Once again, a fraudster steals tens of thousands of pounds and gets away with a slap on the wrist. In this case, the culprit deliberately stole covid funds and managed to avoid jail time. Authorities claim they take fraud seriously, but the sentences they hand down do not reflect that. Light sentences send the message that the UK does not effectively punish fraudsters. Criminals perceive the low risk of prison and feel free to continue with their schemes.
Every year, the number of fraud cases rises, and the losses amount to billions of pounds. Organised fraud gangs exploit this weak response. They know courts often suspend sentences or impose minimal community orders. These punishments offer little deterrent. The promise of lenient treatment encourages more offenders to target government support schemes and individual victims alike.
Victims suffer more than financial loss. They face stress, loss of trust in institutions, and lengthy recovery processes. Meanwhile, convicted fraudsters receive minimal restrictions. They return to society with their reputations intact, and their stolen gains are rarely fully recovered.
A genuine commitment to combating fraud necessitates stricter penalties. Judges must impose immediate custodial terms for large-scale fraud. Lawmakers should update sentencing guidelines to reflect the severity of the crime. Until the legal system delivers real justice, fraud will continue to grow unchecked in the UK.
