Businesses who claimed lockdown compensation illegally must repay €10 million

Businesses who claimed lockdown compensation illegally must repay €10 million
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The Flemish government is to pursue businesses who illegally claimed lockdown compensation, forcing them to repay up to €10 million they were never entitled to.

At the outset of the coronavirus outbreak, the national government introduced a number of lockdown measures such as the closure of non-essential shops, bars and restaurants.

The regional government then had the job of compensating businesses on their territory for the loss of earnings caused by those measures, or by other circumstances that made it impossible for them to work.

In Flanders, the government offered a one-time premium of €4,000 for the period to April 5, after which it was replaced by a daily premium of €160 a day.

The Flemish agency for innovation and enterprise (VLAIO) boasted on its website that the procedure for applying for the premium was so simple it would take only six minutes to complete. In the first six days, 44,632 premiums had been agreed.

A month later, at the beginning of May, financial daily De Tijd carried out an investigation into the system of compensation, which revealed that there had been “substantial abuse” of the system in Flanders and at federal level.

Support is being sought, for example, by front companies that have already been used to conceal other criminal activities, or by ghost companies that no longer have real economic activity,” said Eric Van den Broele of business data specialist Graydon.

There is a hold-up of the state taking place,” said one accountant. “It’s disgusting.”

This week, Flemish economy minister Hilde Crevits (CD&V) revealed that 24,000 applications for the compensation had been turned down.

Abuse of corona support is disgusting,” Crevits tweeted, and warned that VLAIO had taken on 15 extra inspectors to look into claims, while those found to be fraudulent would face severe sanctions, from fines to possible prison sentences.

Among the examples uncovered by Het Laatste Nieuws were a copywriter who had taken a week off work to claim the compensation, while he spent the time helping his children with their homework. And an artistic professional who claimed a workshop he owned had been forced to close, despite the fact that he never used it professionally before the virus.

VLAIO inspectors, meanwhile, have carried out an examination of a sample of 3,500 claims, which revealed that more than one in three was faulty. The sums involved could be as much as €10 million.

Crevits has also warned that accountants and bookkeepers who were involved in any fraudulent claims will also be prosecuted along with their clients.

Alan Hope

The Brussels Times

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