Plans to open a chain of submarine-themed restaurants were sunk when the deal fell through - leaving the man behind the scheme £45,000 in the red, a court heard.

Businessman Ian Hopper hoped to involve Hollywood mogul Steven Spielberg in his ambitious plans.

He flew into the UK from Australia to meet a consortium - involving Darlington man George Steen, 54 - which had promised to lend him £4m to float the venture, Southward Crown Court was told. But the deal collapsed.

Mr Hopper told the court: "I required the loan as soon as possible because I had been able to identify a very suitable site for the restaurant."

After seeing a newspaper advertisement offering loans, Mr Hopper got in touch with agents Dennis Alexander, 47, and David Andrews, 38.

He met Mr Andrews in Brighton, where he submitted his business plan before it was forwarded to Mr Steen, who, with his wife, was at the helm of a company called Peninsular Holdings Overseas Administration.

Mr Hopper told Mr Andrews he needed the money to build the restaurants on Australia's Gold Coast and in the Far East.

He had been involved in discussions with film director Spielberg who, he said, was interested in the franchise.

He said he paid the £7,000 administration fee and was told no bank guarantee was needed for the loan.

Before flying back to Australia, Mr Hopper paid another £38,000 and was convinced the loan was being processed.

The court has heard that the consortium then asked Mr Hopper for a 40 per cent collateral bond of £1.6m.

When he was unable to pay the amount, the trio severed the contract and kept Mr Hopper's money, it is alleged.

He said: "I was totally confused. I did not know what was going on. I thought we had totally discussed the matter.

"I believed the collateral bond was an agreement between two parties to ensure the principal would be paid upon completion of the loan."

The court has heard that the strict contract guidelines earned the trio millions from more than 100 people.

Mr Steen, of Hanover House, Victoria Road, Darlington, Mr Alexander, of Rottingdean, and Mr Andrews, of Hailsham, both East Sussex, all deny one charge of conspiring to defraud between January 1, 1996 and June 6, 1999.

A fourth man, Colin Hardy, of Redcar, east Cleveland, who was also allegedly involved in the fraud, died last year.

The trial continues.