A SEX parlour boss bought a string of properties across the country by "salting away" a fortune in unpaid tax, a court heard.

John Middleton paid for one property now worth £340,000 with cash - despite claiming to earn only £20,000 a year.

Middleton, 61, a convicted pimp who had up to a dozen prostitutes working for him from the Pleasure Zone shop, in High Northgate, Darlington, is fighting a court battle in which police are attempting to seize more than £800,000 from him.

Teesside Crown Court heard yesterday that police believe the cash is the proceeds of his crime.

Middleton claims the actual money he made is nearer £30,000.

He previously declared to the Inland Revenue that he earned an average of £20,000 a year.

Yesterday, Jamie Hill, representing the Crown at the confiscation hearing, said this was a "gross underestimate". He said that Middleton had failed to account for the source of hundreds of thousands of pounds in his possession, including £170,000 transferred into one account over three years.

From the witness box, Middleton played down claims made previously by one girl operating from the Pleasure Zone that she could earn up to £1,000 in a good week.

He said: "If there was one week when they took that much it was an exception to all previous rules and coincided with the ghurkas being at Catterick camp."

The girl, who had given the statement to police, was highly strung and very imaginative, he said.

Middleton, who has timeshares in Portgual and Florida, and 18 bank accounts registered under aliases, was able to buy his home, Barrenthwaite Hall, near Kirkby Stephen, Cumbria, for cash, the court heard.

He had also planned to set up a theme park in Europe, to be based on an American frontier town with saloons, a jail and a blacksmith.

"The only thing missing off the list was a whore house," said Mr Hill.

The confiscation hearing is due to end later today. Judge Tony Briggs is expected to reserve judgement and may not deliver his verdict for up to two weeks.