A clerk at a residential homes group stole £40,000 by claiming refunds that were due to relatives of people who had died, a court was told.

Paul Galloway was jailed for nine months after he admitted sending the refunded fees to his relatives, claiming they were secret bonus payments designed to foil the tax office.

The 26-year-old, who worked for Southern Cross Health Care, in Darlington, stole £39,466 in seven months.

He used the cash as a deposit on a house and bought a second-hand car, widescreen television, DVD player and PlayStation computer games console, said Richard Cowen, prosecuting.

The thefts came to light after Galloway was dismissed for bad time-keeping and work standards, when a relative of a deceased resident applied for a refund.

Records showed it had already been paid to a member of Galloway's family, said Mr Cowen.

He told police that he used the money to fund a better life for his wife and two young children when they were living in an area of drug-dealing and violence, Teesside Crown Court heard.

Galloway admitted his full involvement, telling how he obtained the money, amended company records and had cheques signed by directors.

He gave police a cheque for £7,600 and said he would surrender property bought with the missing thousands. The company had to pay people who were claiming refunds.

David Lamb, mitigating, said that Galloway was almost relieved when he was caught because he realised he was bound to be found out.

He said: "He was so stupid that on some of the occasions he wrote out cheques in his father's name."

Jailing Galloway, Judge Michael Taylor said: "It was deliberate, required a degree of planning and thought, and although it seemed likely it was always going to come to light, you carried on for a period of time. Such is the amount involved here, you must appreciate that I cannot overlook this.

"Some people feel that this is a victimless crime. It is not."

Galloway, of Killin Road, Darlington, pleaded guilty to 16 charges of theft between November 2001 and last June.