The heir to a wealthy Scottish clan who used his computer company to commit a multi-million pound fraud has been jailed.

Charles Forsyth, 46, made a fortune selling faulty computers built from second hand parts by mail order and to retailers including Argos, Asda, Tesco, and Makro.

The father-of-three, who is heir to the wealthy Scottish clan Forsyth, then lied to gain a $1.5 million dollar letter of credit and £750,000 overdraft facility from a bank to prop up his ailing business.

He intended then to float his firm, Personal Computer Science (PCS), on the London Stock Exchange, and stood to gain more than £1.5 million in cash and shares when the sale went through.

But following "a deluge" of complaints about PCS - which was then one of the UK's leading computer manufacturers - and the launch in November 2001 of a Serious Fraud Squad investigation, Forsyth fled to Bulgaria, Russia, then Australia.

He was arrested in November 2002 in Boyup Brook near Perth, Australia, as he left a church service, and served almost a year in a high security jail before he was extradited to the UK.

When he was arrested he was carrying a false French passport and driving licence.

He had been living with his parents.

Forsyth will succeed his father Alistair, 69, as baron and chief of the Clan Forsyth. The wealthy family has strong family links with the Melrose Tea Company and the former RW Forsyth stores, in Glasgow and Edinburgh.

They also owned the famous Ethie Castle, near Arbroath which was sold for more than £600,000 in 1999.

A judge at Newcastle Crown Court heard Forsyth was a "dictatorial" boss who had been desperate to sell PCS before the company went into "complete meltdown".

Prosecutor Gary Burrell QC said: "This was not just a company selling an inferior product or a company selling computers which were not worth the money.

"The defendant's activities went way beyond this.

"Charles Forsyth was fraudulently trading in such a way and at such a level that he knowingly carried on his business with an intent to defraud the creditors of that business and their customers by selling inferior computer products.

"He knew exactly what he was doing. He cared neither for the customers or the companies who, once they had paid PCS, effectively became helpless as they battled for repairs, replacements and refunds."

Mitigating, John Jones QC told the court PCS, based in Boroughbridge, North Yorks, was a profitable and honestly run company until the early months of 1998.

By then, however, profit margins had plummeted leading to a "downward spiral" for the company.

The firm's legitimate business "was not sufficient to bail the company out" and Forsyth became "reckless" in his efforts to keep PCS afloat, conning the Yorkshire Bank and Government Office North East out of approximately £2.5 million.

Jailing Forsyth for three-and-a-half-years yesterday (Thurs), Judge Guy Whitburn QC said: "People say frauds of this kind are victimless. They are not.

"We all suffer when public money is lost because it comes from the public by way of taxation.

"And the major businesses pass on their losses to the consumer, which is the general public.

"You have shown no sign of remorse or contrition. You, Forsyth, absconded and then sent to the authorities an impertinent letter clearly suggesting it was your intention to evade justice.

"None of these are the actions of a man who acknowledges his guilt." Jude Whitburn banned Forsyth for ten years from being the director of a company.

And he praised the actions of the Serious Fraud Office, adding: "The Serious Fraud Office is from time to time pilloried but it is right to praise and praise in large degree, as I do, their work when it achieves perfectly what it was set up to do."

Forsyth, formerly of Littleworth, near Oxford, had admitted two charges of fraudulent trading committed between January 1 1998 and April 26 1999 and two charges of breach of copyright, obtaining percuniary advantage by deception.

He also admitted two charges of furnishing false information.