The taxpayer-funded bank set up to support at-risk U.K. businesses during the pandemic failed to ask even basic questions or carry out sufficient due diligence when it gave collapsed lender Greensill Capital approval to hand out £350 million (U.S. $465 million) to a group of companies being investigated for fraud and money laundering.

According to the U.K. Parliament’s Public Accounts Committee report into Greensill released in November, the British Business Bank’s checks to approve the company as a lender under the government’s COVID-19 support program were “woefully inadequate.”

This lack of scrutiny, curiosity, and skepticism might end up costing taxpayers £335 million (U.S. $445 million), according to Members of Parliament (MPs).

When the pandemic provoked a lockdown in March 2020, the U.K. government introduced business support to help companies stay afloat. These programs offered lenders a government-backed 80 percent guarantee should any of their borrowers default through the British Business Bank, set up in 2012 to provide financial support to small- and medium-sized firms.

To get money to businesses quickly, the bank streamlined its lender accreditation process by performing limited due diligence upfront and placing greater reliance on audits after loans had been made.

MPs found the bank also relied on a narrow evidence base and took information from Greensill and other lenders at “face value.” It placed too much reliance on the work of others in accrediting Greensill, including auditor Saffery Champness, whose work is currently being investigated by the U.K. Financial Reporting Council.

The bank previously acknowledged “applying a less streamlined process might have led it to further question Greensill’s application.”

The decision to accredit Greensill enabled it to make £418.5 million (U.S. $556 million) of loans to companies—£350 million of which went to the Gupta Family Group (GFG) Alliance, a group of companies owned by steel and mining magnate Sanjeev Gupta. The GFG Alliance is under investigation by the U.K. Serious Fraud Office over suspected fraud, fraudulent trading, money laundering, and its financial dealings with Greensill.

In the report, MPs found the bank was “insufficiently curious” about media stories questioning Greensill’s lending model, its ethical standards, and its overexposure to borrowers until the money had been transferred.

For example, the bank did not check which companies Greensill proposed to lend to, nor did it explore the concerns other government departments and regulators had about Greensill, including those who were assessing it for access to other programs.

The bank also neglected to carry out checks with the company’s credit insurer—a vital misstep given the company’s collapse was due in large part to its insurers refusing to renew cover for the loans the business was making.

MPs were particularly scathing about the bank’s admission it was “very surprised” when it noticed Greensill had issued seven loans totaling £350 million to borrowers within the GFG Alliance—six of which were issued on the same day—which appeared to “flagrantly contravene” the £50 million (U.S. $66 million) lending limit to groups.

The bank is unable to confirm how that money was used or in which country it was spent.

On Oct. 12, the British Business Bank launched an investigation into Greensill’s compliance with the program rules. The investigation is ongoing.