Toy fanatic jailed for pounds 12m fraud: Businessman who won Queen's Award for Industry 'created fantasy world in which he was an international wheeler-dealer'. James Cusick reports

A BUSINESSMAN with an irrational passion for toys that led him to fake a jet-set lifestyle and defraud banks out of pounds 12m, was jailed for four years yesterday.

Jeffrey Levitt regarded toys 'as more important than anything else'. Described as having a 'Peter Pan personality', he created a dream world where he became an international wheeler-dealer in antique toys. His world was filled with luxury cars, a lavish Madison Avenue gallery and seven-bedroom mansion in Rickmansworth, Hertfordshire.

Levitt, 36, built up a childhood obsession that started with Dinky cars into a business that attracted the attention of Hollywood stars such as Richard Gere and Brooke Shields. He won a Queen's Award for Industry and appeared on the Wogan television show as a 'rising businessman putting toys on the map'. However, the apparent glittering success was being funded by an elaborate fraud.

At Southwark Crown Court yesterday, Levitt, of Heronsgate, Hertfordshire, pleaded guilty to eight charges of fraudulent trading and evading VAT and import duty. He set up loans with the NatWest and Midland banks worth pounds 13m. He forged letters from big companies offering millions for non-existent toys. The banks would pay him advances to cover the period between the sale and payment. But the sales were bogus, with the banks never being repaid. Genuine imports were undervalued to evade import duty and VAT.

Mr Stephen Solley QC, representing Levitt, told Judge Christopher Hardy that 'Levitt's primary motive was not financial gain. It was to be at the centre of the toy antique market. It gave him great respectability and a persona.'

The fraud also gave him a lifestyle that involved jetting around the world on Concorde and, one witness said, 'spending money like water'. Although he had a mansion, he rarely lived there. A psychiatric examination of Levitt's personality found him to have a severe personality disorder. The report said there was 'something worrying, even crazy, about his thoughts'. He was described as a Walter Mitty.

The court was told Levitt, who was raised in Harrow, became a respected expert in antique toys, writing a book on them. His disorder had, however, been noted. In 1981, then 24, he received psychiatric treatment, the doctor stating that he 'was more like an adolescent'.

His psychiatric history was never revealed to City businessmen who had links with Levitt. Mr Solley told the court that the money went on travel, entertainment, promotions, backhanders and salaries to people who took advantage of him.

The business bought and sold the very best toys to appear at the world's auction houses. After the firm crashed, Sotheby's sold off remaining stock for pounds 600,000 including a 1910 German tin plate carousel for pounds 47,000. Levitt's company, Mint and Boxed, collapsed in 1991 with debts of pounds 15m.