A Darlington businessman has appeared in court charged in connection with a multi-million pound fraud.

George Steen, 54, was accused of pledging loans to desperate businessmen and not paying out.

The 54-year-old appeared at Southwark Crown Court with Dennis Alexander, 47 and David Andrews, 38.

Mr Steen, of Hanover House, Victoria Road, Darlington, Mr Alexander of Elvin Court, Rottingdean, East Sussex, and Mr Andrews, of Polegate Road, Hailsham, East Sussex, all deny conspiracy to defraud between January 1, 1996, and June 6, 1999.

Another man, Colin Hardy from Redcar, Cleveland, was also allegedly involved in the fraud, but he died last year.

The court heard how the three men advertised their loans in English-speaking countries abroad.

More then 100 customers got in touch, requesting loans from £500,000 to £25m.

Some wanted the money for business ventures such as setting up a private hospital, hotels, or golf courses.

Richard Latham, prosecuting, said the gang insisted to each other that customers must be based overseas. He told the court: "This was very useful because they found it much more difficult to complain in person.

"It would be very costly to come over to the UK, in particular if the person lived on the other side of the world.

"Most of the people were from New Zealand, Australia, Canada, and the US."

Mr Latham said Mr Andrews and Mr Alexander took on the role of agents in the scam.

They would tell clients they could get them interest-only loans from a contact who was in fact Steen, it is alleged.

He said: "These fraudsters were not looking for people who could raise a very large sum of money from somewhere else.

"Some of them were quite vulnerable applicants and some of them were financially quite unsophisticated."

Mr Latham claimed the three had taken several million pounds.

"They made a good living in this enterprise," he said

"The business that these defendants ran did not require the expenditure of a great deal of money. It was a lightweight enterprise without huge costs."

Mr Latham added that if any clients could find the money, the gang would tell them that time had run out and the contract was cancelled.

It is alleged the three were masquerading as financial consultants.

Mr Andrews ran Corporate Advances from an office in Edward Street, Brighton, while Mr Alexander was in charge of a company called Diverse Trading. Mr Steen and his wife were at the helm of a Darlington- business called Peninsular Holdings Overseas Administration.

The trial continues today.