A FINANCE director who worked for TV star Duncan Bannatyne's gym business has admitted an £8m fraud after he was exposed to a "culture of undoubtedly corrupt company management".

Gambling addict Christopher Watson - who took huge sums over a period of years to cover his debts with major betting firms - was jailed for four years and eight months yesterday.

The married father-of-three, from Cleveland Avenue, Darlington, admitted one count of fraud, representing him taking £7,974,221 between 2008 and 2014.

The 46-year-old also pleaded guilty to five counts of transferring criminal property - representing homes he bought in the Darlington area - with the stolen cash.

Mr Bannatyne, famous from the Dragons' Den BBC series, was not in court, but said in a victim personal statement: "I'm absolutely shocked and appalled at the callous actions of Mr Watson."

The Northern Echo: Duncan Bannatyne

The entrepreneur, pictured above, said he had raised the issue of increasing some staff's pay from the Minimum Wage level at meetings, but "Chris Watson argued cash flow would not allow it".

Mr Bannatyne said he refinanced the firm in 2014, and sold freehold land which he had to then rent back, "although it had always been my plan to pass the land along with my companies to my children".

Andrew West, prosecuting, said the offending was an abuse of trust by the accountant who worked at the Darlington head office of Bannatyne's Fitness Limited.

"He siphoned off huge amounts of money from corporate accounts to accounts held by him," Mr West told the court.

Watson made 162 fraudulent transactions from Bannatyne's Fitness, and used the money to finance his gambling, or to further his own financial interests.

The finance director, who was also company secretary at the time, was paid £85,000-a-year, plus a "generous bonus scheme", Teesside Crown Court heard.

Mr West said Watson tried to cover up his dishonesty by submitting doctored invoices which he could pay into his own accounts.

He used the money to pay off debts at the betting firm Spreadex of £5.4m, with another £500,000 at Ladbrokes and £250,000 at Sporting Index, the court heard.

When Watson was eventually arrested he told police he found he had the opportunity to steal and claimed he had been corrupted.

Mr West said: "He took money as he thought they were all doing it."

Adrian Langdale, defending, said: "He is very much a product of the environment he found."

Watson was into his 40s when he joined the firm and was a "good, honest, hard-working individual".

Mr Langdale said: "He found a culture of undoubtedly corrupted company management.

"It is clear he was getting corrupted both financially and morally.

"He began to lose sight of where the line lay, the line between what's right and wrong."

Mr Langdale said it was a stressful job and there was bullying, and he claimed there were examples of people using the business to cover debts or using the company "as a form of personal bank account".

Watson, who started his working life as a shelf-stacker at Morrisons and worked his way up, became addicted to gambling, Mr Langdale said.

At first he took money from the firm to try to recoup his losses, but they became too great.

Mr Langdale said: "He will have lost everything through his own actions.

"He has lost his job, his employability, he will have lost his home, his reputation, his liberty.

"He will have lost, in many ways, his children and his wife for a significant period of time."

The Bannatyne Group said other legal proceedings were continuing relating to the head office fraud.

In a statement outside court, the firm said: "We informed the police of this matter and would like to thank them and the CPS (Crown Prosecution Service) for their diligence in bringing it to court.

"The recent company accounts reflect this substantial fraud committed against the business.

"A new management team is now in place and 2015 is shaping up to be the best year in the company's history with increased turnover, membership numbers and profit.

"We welcome the sentence and have no further comment as some matters relating to the fraud are still subject to other legal proceedings."

Detective Inspector Traci McNally, of Durham Constabulary, said: "I am delighted with the length of sentence which represents the severity of the offences committed by Christopher Watson and the fact that he held a position of trust within a well-known company.

"He laundered vast sums of money to support a gambling addiction and also to fund a portfolio of property and businesses in the Darlington area."