A former police officer who funded his lavish lifestyle by duping thousands of people involved with a horse racing betting syndicate has been jailed.

Michael Stanley admitted misusing money from members of the Layezy Racing Syndicate for several years before his arrest in 2019.

Terry Wildey, a retired hairdresser from Kent, said he and his family had put £200,000 into the scheme after he encouraged his own relatives to invest.

“He’s a rat isn’t he,” he told the BBC, after Stanley was sentenced to six years’ imprisonment at Maidstone Crown Court.

“He consciously set that up with the sole intention of taking people’s money.”

About £44m was paid into the scheme and an estimated £34m was withdrawn by members, leaving a £10m shortfall which remains unaccounted for.

One victim lost nearly £500,000, the court heard.

The former Kent Police sergeant, 68, pleaded guilty to running the “Ponzi scheme” in March.

The court was told the syndicate started out with family and friends and grew to more than 6,000 members, and had a waiting list of 3,000 people at the time it collapsed.

It also heard that Stanley, from Walderslade, used £4m on personal spending, including to buy himself a £400,000 property in Spain, Land Rover vehicles amounting to more than £600,000 and 23 race horses.

He also bought £1.6m in cryptocurrency and £622,000 worth of silver bullion.

The judge told Stanley: “Your conduct was not reckless, but deliberate, sustained and repeated. When people gambled with you, they did not know the true odds. They were told lies.”

Stanley, who gained the trust of members thanks to his background as a police officer, was also banned from being a director of a company for 15 years.

He will serve half of his sentence in custody, and the rest on licence, while a five-year Serious Crime Prevention Order will start on the day he is released from prison.

Mr Wildey said he got family members involved – including his children, his wife, his mother-in-law and his brother-in-law – because a financial incentive was offered to do so, whereby members got a percentage of any ‘winnings’ of the people they referred.

“Initially [I put in] £1,000, just to try it out,” he said.

“And then you get a portal and you can watch your money grow. And I watched my money grow, and I thought ‘my money’s not growing fast enough because it’s not big enough’, so I put more money in.”

Det Sgt Alec Wood, head of complex fraud at Kent Police’s economic crime unit, said the case was largest fraud the force had ever prosecuted.

Stanley left the profession more than 40 years ago, and Det Sgt Wood said his behaviour did not “reflect the current professionalism and dedication” of officers.

He said Stanley had made “various promises” privately and publicly to members about the scheme’s success.

“Ultimately, when we looked at the evidence this was manifestly false and that was effectively the fraud,” he added.

He described the syndicate as a “clear Ponzi scheme”, adding that in one year, Stanley lost £1m with a betting company.

Angela Elven, who invested about £5,000 in the scheme, told the BBC that while members of the syndicate took “a gamble”, they believed Stanley because “he seemed like a very genuine person”.

“He’s affected so many people’s lives, so he should pay for what he’s done,” she said.

In a victim statement read out in court, another member told of how he joined to fund a safe environment for his son, who has Down’s Syndrome, as he got older.

He described the “deep, sick gut feeling” he had realising they had likely “lost all our money, all our plans, hopes and dreams gone”.

Defending himself, Stanley said as the scheme grew he was overwhelmed by the workload in the face of his wife’s cancer diagnosis in 2014.

“I am very sorry for the hurt I’ve caused members and my own family, I cannot understand how I let it happen apart from my own fear of discovery,” he said.

He was arrested in August 2019 and charged with dishonestly making false representations to members of the syndicate.

He was accused of knowingly running a business for a fraudulent purpose contrary to the Fraud Act 2006.

And he was also charged with three counts of knowingly running a business for a fraudulent purpose contrary to the Companies Act 2006.

The three counts related to the running of Layezy Ltd, Layezy Racing Ltd and Number 1 Guide Ltd.

Stanley pleaded guilty to all five offences.