A couple who lived a ''high roller'' lifestyle paid for by tens of thousands of pounds plundered from a children's charity were being sentenced today.

Joseph Mulcahy and Maureen Lewis siphoned off the cash from the Dream Foundation which was set up to pay for the wishes of dying children to be fulfilled.

The pair were warned they faced lengthy jail terms after being found guilty yesterday by a jury at Newcastle Crown Court of conspiring to defraud the fund, which they helped found.

Judge Guy Whitburn QC told them: ''This is an extremely serious fraud indeed on a charity in which you were intimately concerned and of which you, Joe Mulcahy, proudly boasted that you were the founder.

''Very substantial sums of money have gone through your hands dishonestly. I have to say that I have in mind a very substantial prison sentence.''

The month-long trial heard how Mulcahy, 56, who had 17 years' charity experience, nominated his partner Lewis, 50, to become a trustee in the charity as he was bankrupt.

The charity had won support from the public, businesses, and local organisations, and held an annual ball attracting more than 200 people.

But much of the money was diverted into personal and business accounts linked to the pair and used to pay for trips to America, mortgage repayments, and credit card bills.

The pair, of North Lodge, Chester-le-Street, County Durham, were remanded in custody to be sentenced today. Also in court will be former policeman David Foley, another founder of the Dream Foundation, who has pleaded guilty to separate charges of stealing from it.

After the trial Superintendent Paul Beesley, who led the investigation, described Mulcahy as a ''parasite''.

He added: ''People assume that fraud particularly is a victimless crime but in this particular case the victims are all too evident.

''You have got the people who have made cakes and raised sponsorship and also sick and dying children who have not benefited from monies raised so the victims, to us, have been perfectly clear and obvious.''

Dc Dave Horsley said: ''Mr Mulcahy was a sort of pretend high roller.''

Mr Beesley added: ''When they organised functions they took on the mantle of being minor celebrities.

''They were very respectable to people on the outside and also to people very, very close to them because the frauds they perpetrated could be done in a very covert way.''

He said the crime came to light when Mulcahy and Foley fell out.

Mulcahy reported Foley, at the time a serving officer, to the police, but the investigation led to the discovery of his own crimes.

While 170 children had their dreams fulfilled by the charity, Dc Horsley said only £320,000 of the overall receipts of £1.1 million had been spent on them.