An Axminster man and company chief fleeced the Ministry of Defence out of more than £800,000 by selling equipment including underwater scanners that were 'not fit for purpose', a court heard.

Carl Tiltman, 56 and of Hawkchurch, admitted conning the MoD into buying equipment he knew was useless, in a fraud carried out on Portland.

Tiltman was the chief executive officer of Subsea Asset Location Technologies (SALT), which had been based at Osprey Quay and was set up in 2009 to provide underwater scanning technology and consultancy services to the MoD.

But Tiltman, who had worked as a sonar engineer for a government laboratory, lied to an official when promoting his firm’s services and equipment.

It was said he used bogus results from scanning equipment to convince the Government to invest and provided false information to the MoD for products that were not fit for purpose and some that had not been manufactured.

The value of the fraud was said to be 'in excess of £800,000'.

Tiltman had originally faced 14 fraud charges and one of criminal damage.

One charge alleged he 'recommended the MoD purchase a series 500 version precision scanning equipment to the value of £262,920, knowing that following a trial of the series 200, it would not be fit for its intended purpose and thereby intending to cause loss to the MoD.

He also sold the MoD a virtual reality system for £9,396, and more scanning equipment for £184,992, it was said.

He was further accused of invoicing it over £470,000 for work he knew could not be done – plus £3,600 for 'spare equipment' not needed for a job.

And he allegedly failed to tell the MOD equipment it had bought had not been made yet, and destroyed equipment by removing a switch and causing another £8,000 worth of damage.

The court was earlier told the fraud fell into two categories – abuse of Tiltman's position and making false representations in relation to technology he was developing.

Tiltman admitted fraud by abuse of position and fraud by false representation said to 'capture the substantial criminality of the previous allegations'.

He has been CEO of SALT since 2012, and before that worked as chief technology officer.

Tiltman was bailed ahead of sentence at Southwark Crown Court on January 10.

The MoD said: 'We have a zero-tolerance policy towards fraud and investigate all allegations.'