A BUSINESSMAN who nearly destroyed a North-East company following a £2.4m fraud has been jailed for seven years.

Douglas Brown, 61, used his role as managing director of Palmer UK, in Hartlepool, to swindle the company out of millions of pounds to fund a luxury lifestyle.

Brown pleaded guilty to 31 counts of obtaining money transfers by deception, taken from his employer Palmer UK, totalling more than £2.4m between November 1995 and February 2007.

He asked for a further 152 offences to be taken into consideration.

Brown claimed he was making pre-payments to suppliers of Cashew Nut Shell Liquid, used in the manufacture of brake-linings, but banked the money himself.

At Teesside Crown Court yesterday, the Recorder of Middlesbrough, Judge Peter Fox, said: “This was a sophisticated and convincing fraud, little short of enormous proportion and perpetrated over a specially prolonged period of time – over 11 years.

“It was a serious breach of trust with an international trading partner, which brings shame to your country, as it does your family.

“The consequences to others, I am satisfied, have been severe on both sides of the Atlantic.

It is a particularly unattractive feature that British redundancies were at your instigation, while you were in very well-paid remuneration from the employer you betrayed.

“Your greed was squandered on a very extravagant lifestyle.”

Brown joined the firm in 1984, and became managing director in 1990. In 2005, he was made joint chief executive of the Pennsylvanian parent company, alongside Kevin Palmer.

Brown, of The Green, Houghton-le-Spring, Wearside, made fake invoices before writing out blank cheques to himself.

According to Mr Palmer, the company suffered on both sides of the Atlantic as a result of Brown’s actions.

In 2001, Brown recommended six people should be made redundant because the firm was losing cash and another four jobs were lost in 2006. The fraud came to light after he was offered early retirement.

His £79,000-a-year salary was not enough to fund his luxury lifestyle, which included BMWs, a £850,000 house in Lambton Park, Chester-le-Street, and a holiday home in Florida Keys, worth £1.1m.

He also used expenses, which the company had ordered employees to be frugal with, to stay at posh hotels, dine at Gordon Ramsay’s restaurants, have hair appointments at Vidal Sassoon, and shop at Harrods and Harvey Nichols.

Brown’s barrister, Euan Duff, said he was a decent man, who had been considered to be doing a good job.

Brown’s wife, Joan, 58, denied five counts of money laundering totalling £35,000, and was yesterday told no further action would be taken.

Speaking afterwards, Mr Palmer said: “We are pleased with the sentence. It is not right that our employees and ex-employees made redundant had to make sacrifices in order to subsidise Brown’s extravagant lifestyle.”

Detective Sergeant Ted Butcher, of Cleveland Police, said: “Cleveland Police can confirm that the appropriate action in relation to recovering assets from Mr Brown in relation to this £2.4m fraud are being actively and vigorously pursued.”