A COMPANY director has narrowly escaped jail after she and her husband spent thousands of pounds of investors' money.

Jean Mattimo, 59, and her husband, Anthony, ploughed hundreds of thousands of pounds into the upkeep of the Park Head Hotel, at New Coundon, near Bishop Auckland.

The venture ultimately folded with debts of more than £2m in September 1996.

Newcastle Crown Court heard yesterday how the pair lured friends and relatives into investing money into shares but registered the monies as personal loans.

Peter Johnson, prosecuting, told the court how one woman lost £270,000 which she invested into the doomed hotel.

But Mattimo, secretary and director of the company, claimed she did not have the qualifications to deal with the running of such a large business and was acting under the instructions of her husband.

Judge Denis Orde accepted that her husband, who will be sentenced at a later date, played the main part in the fraud and instructed his wife in what to do.

But the judge said: "You stood to gain, and did gain, by what was going on."

The court heard how Jean Mattimo, of New South View, Windlestone, Chilton, resorted to taking out huge personal loans to pay off some of the mounting debts and has now lost everything.

She is currently working as a secretarial temp for the NHS.

Yesterday, she pleaded guilty to four charges of failing to keep proper accounting records and was sentenced to a nine-month jail term, suspended for two years.

She has been disqualified from being a company director or manager for five years.