I would guess the argument is that the loan was made (accidentally) in breach of trust or was otherwsie ultra vires, and so the money is not held by the beneficiary as debtor but as constructive trustee - a bit like how funds in an illegal dividend or illegal share buy-back etc. are arguably held by the recipient as constructive trustee and of course the EBT trustees are not going to sue the beneficiary for the return of the money are they? If that's the legal analysis and it's supported by a tax barrister opinion etc. then there is no scope for fraud etc. in my view. Clearly, the (new) Antoniades v Villiers and Autoclenz v Belcher (quasi sham terms) argument in Oco Ltd v HMRC (http://www.bailii.org/uk/cases/UKFTT/TC/2017/TC06031.html) will presumably kill this scheme if instead it's simply a case of calling a spade a fork (licence/lease etc. cases)
There are certainly trust cases where trustees have tried to sue a beneficiary for repayment of a loan and the beneficiary turns around and says the loan is illegal as the trustees had no consumer credit licence etc. (and thereby had no right to repayment), so maybe that is the analysis?