Company director who stole firm's cash must pay back more than £500,000

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A financial director who was jailed after he lived the high life on company cash while his firm headed into administration has now been ordered to pay back over half-a-million pounds.

John Forrest stole over £600,000 from his recycled food packaging firm Re-Pet at Houghton, which he founded with two business partners, to splash out on furniture, holidays, school fees and hotel stays.

Newcastle Crown Court heard as his fellow directors worked hard to make the business a success, Forrest was siphoning away money to keep for himself.

On top of taking £646,996 from the business, Forrest fraudulently claimed more than £350,000 in VAT from the taxpayer for the firm.

The company went into administration.

Forrest, of Hawthorn Road, Gosforth, Newcastle, admitted theft and fraud charges and was jailed for three years and eight months in May 2015.

The 50-year-old was also banned from being a company director for ten years.

His case was back in crown court today (Fri) after prosecutors pursued him through the Proceeds of Crime Act where Judge Robert Adams ruled Forrest made £646,996 through illegal activity.

The judge ordered he must pay back £522,380, which is the full amount he has available in assets, or potentially face another jail term.

At the original sentencing hearing in 2015, Prosecutor Rupert Dodswell told the court Forrest and his two partners, who were old friends and colleagues, set up the business in 2010 at an industrial estate in Houghton.

All three made vast personal investment in the company.

They secured investment from two other firms, who became shareholders in the company, which was initially a success.

Forrest's fraud started to unravel when the company received a visit from a customs officer in relation to the VAT fraud in late 2012, which spared an investigation into the firm's finances as a whole.

When the enormous irregularities were found, Forrest was suspended and later dismissed from his role as financial director.

Inquiries revealed Forrest had transferred huge sums of cash from the company bank account to accounts held by his other businesses and had sent some to his own personal account.

He has spent over £163,000 on company cards and cheque books.

In a victim impact statement, a fellow director in the firm said the business has been loft "mortally wounded" by Forrest.

The director said he has been threatened with violence by an unpaid creditor and that his long standing working relationships have been effected.

He said his "heart and soul" along with long, hard hours, which cost him precious family time, went in to trying to make the company a success.

Mr Dodswell added: "The greatest betrayal was his trusted business partner was enjoying holidays, expensive hotels, and only worked school hours."

Jonathan Devlin, defending at the sentencing hearing, said Forrest is of previous positive good character.

Mr Devlin added: "This will be his first experience of a custodial setting.

"The court can be assured that he is at low risk of re-offending.

"He will not re-offend."