AN entrepreneur with an idea for a new clothing range claims all he got for £600 was a six-inch piece of elastic.

Colin Butt was another customer of convicted fraudster Michael Smallman's ailing company, a court heard yesterday (Monday, May 23).

He was hoping to launch a range of boxer shorts called Butts Underwear when he contacted Smallman in summer 2013.

Mr Butt, from Washington, visited the APM Clothing Development company office in Newton Aycliffe, County Durham.

He told a Teesside Crown Court jury he was impressed by Smallman's enthusiasm and apparent know-how and said he was assured by the 52-year-old that his firm could manufacture what he wanted and would draw up underwear designs.

But after handing over £600 for three samples, all he received was a short piece of elastic waistband with BUTTS on it, he said.

After several months, he tried to contact the company and finally got an answer on the telephone - to say it was no longer trading.

Mr Butts said: "They just disappeared from the earth and vanished - with my samples as well.

"I had heard through different people that the business was now not trading and I had lost my money."

The court heard how Mr Butt had originally had samples made by a different firm, and supplied APM with them as "reference points".

Under cross-examination from William Byrne, he accepted that Smallman seemed professional and he had a lot of contact with one of his designers.

Gambling addict Smallman, of Castle Hill, Richmond, North Yorkshire, denies nine charges of fraud and two of theft.

The prosecution claims he failed to deliver orders, deliberately misled customers, and used their money to fund his betting habit.

In one month alone, Smallman - convicted of fraud in the past - lost more than £10,000 gambling while his company account was overdrawn, the court heard.

Another customer, James Pickard, who runs a skiwear company called WillyFinders, told the jury how his firm lost an investment almost £20,000.

Mr Pickard placed an order for 400 ski suits as well as boxer shorts and longjohns and received just one sample suit - and a £50 refund.

Mr Byrne told the jury that a problem with the manufacturers in China - even though Mr Pickard believed they were being made in the UK - caused delays and financial difficulties.

The trial continues.