A crooked hotelier cheated almost £500,000 in taxes by pocketing deductions from the wages of 50 employees.

Michael Stainer committed the fraud over a four-year period while running The Grand on Folkestone seafront and a number of businesses operating from the imposing Edwardian building.

A jury at Southwark Crown Court yesterday found the 74-year-old guilty of two counts of cheating the public revenue and one of fraud by false representation.

His wife, 60-year-old Doris Stainer, had appeared charged with the same crimes but was found not guilty.

During the trial the court heard how money taken from staff pay-packets and meant for HMRC were simply scooped up by Mr Stainer.

The years-long swindle was said to total £473,097.07, jurors were told.

Anthony Hucklesby, prosecuting, told the court: "The Grand was employing in the region of 50 members of staff and paying them net deductions.

"The staff were employed by Grand Folkestone Ltd but never made any PAYE or national insurance contributions at all during the indictment period."

The court also heard how after a visit by revenue official, Mr Stainer tried to make submissions to HMRC but the company’s PAYE account had been cancelled because of inactivity.

Following the jury's verdict Richard Wilkinson, assistant director of the HMRC fraud investigation service, said: "We welcome today's conviction of Michael Stainer, an employer who was stealing from his own staff.

"Instead of lining his pockets with their stolen tax contributions, this money should have been funding our vital public services, such as hospitals and schools."

Mr Stainer, a chartered accountant, owned The Grand - once a favoured haunt of royalty - for more than 40 years but the couple were forced to step away after being declared bankrupt.

Residents of the building, which is primarily made up of leasehold apartments, last year purchased the former hotel at auction for just £448,000.