A TAXI operator and former crime prevention chairman narrowly escaped a prison sentence yesterday for selling bogus insurance to drivers.

Peter MacGregor, 64, devised do-it-yourself insurance documents on his home computer and sold them to four fellow taxi drivers in the Chester-le-Street area of County Durham.

Durham Crown Court heard that the former Army officer resorted to the scam to keep his ailing business afloat, at a time when he was unable to drive himself due to health problems.

It only came to light after one of the drivers was stopped by police and asked to produce his documents.

When he had handed over his insurance certificate, supposedly an Octavian at Lloyds' policy, the police established that it was a fake.

Chris Williamson, prosecuting, said MacGregor made £2,366 from the drivers, who were under the impression they were genuinely insured.

John Temple, in mitigation, said they made no net loss, and told the court: "Mr MacGregor didn't gain anything from those he was selling. It was purely to keep his business afloat.

"He's extremely ashamed of his actions and he's extremely remorseful.

"It's had a catastrophic effect on his family."

"He is nearly 65 and of previous impeccable character, sitting on various civic committees, and previously an Army officer who was medically retired due to injuries suffered in Northern Ireland."

MacGregor, of Angus, Ouston, near Chester-le-Street, admitted ten charges of using a document with intent to deceive at a previous hearing.

Imposing a 120-hour community punishment order, Judge George Moorhouse told him: "Extremely serious consequences would have followed if one of these drivers had been involved in an accident.

"I've read exemplary references on you and you have an excellent Army record.

"I consider these offences so serious to justify passing a custodial sentence, but I'm prepared to take a risk in this case."