Marian Ghimpu, 58, from Croydon has also been disqualified from being a director for 13 years and ordered to repay over £50,000 to the public purse.

The compensation order is the result of abuse of the Bounce Back Loan scheme by Ghimpu during the pandemic.

In October 2020, he took out the maximum £50,000 available despite his company only being eligible for a loan of £2,000, the minimum amount available

Bank accounts for his company, Deea Construct Ltd, showed no activity for a year up to the point when he claimed the loan, and only a handful of small transactions totalling just over £4,000 from a construction firm in the summer of 2019. But he told his bank his company’s turnover was £200,000.

After receiving the £50,000 loan into the company account, Ghimpu transferred over £40,000 to himself and took the rest out in cash withdrawals.

In April 2021, he put the company into liquidation which triggered an Insolvency Service investigation.

As efforts to recoup the loan money by the liquidator were not successful, the Insolvency Service sought a compensation order against Ghimpu in court.

Chief ICC Judge Briggs at High Court of Justice, Rolls Building imposed a compensation order of £52,163 and Ghimpu was given five weeks to pay.

Nina Cassar, Deputy Head of Investigations at the Insolvency Service, said: “Marian Ghimpu’s actions, providing false information to the bank, allowed Deea Construct Ltd, and himself, to have an unfair advantage over other businesses impacted by COVID-19.

“Abuse of taxpayers’ money will not be tolerated and I am delighted we have secured this compensation order. Where there have been similar cases of abuse by company director, we will be seeking further compensation orders and disqualifications.”