Antony Demarco is facing prison after pleading guilty at Edinburgh Sheriff Court yesterday to stealing the huge sum through false loan applications.
The 37-year-old claimed he committed the fraud to pay off the loan sharks who organised a failed murder bid against his father, Tony Demarco, outside the Gala Maybury Casino in 2008.
Financial investigators charged with chasing down the cash are convinced much of the funds have been hidden in accounts in the Middle East.
Demarco junior is said to have links to Dubai and investigators believe he made trips there around the time of the fraud.
The father-of-two is being pursued through the civil courts in a bid to recover the money.
Investigators say the only way that much of the missing funds may be recovered is through forcing him to sell his home.
Demarco was remanded in custody to await sentencing later this month. His passport was taken from him while he awaited trial as he was deemed a flight risk.
The court heard yesterday that Demarco was a gambling addict who built up huge debts playing online poker before borrowing from loans sharks. He panicked and launched the loan scam after his father was shot in the head over missed payments.
Mr Demarco senior declined to comment to the Evening News outside court yesterday.
Dad shot in head over son's online poker debts
By ALAN McEWEN
WHEN Tony Demarco was shot outside the Gala Maybury Casino, the underworld rumour mill was soon churning out a host of possible motives behind the shooting.
For some it was a simple case of mistaken identity; others believed the 64-year-old – who survived the attack – had been singled out for a deliberate "hit".
Theories spread that gangsters from Glasgow were involved who sought to flex their muscles in the Capital, and of a dispute over a private-hire car firm.
As four men were jailed in February for a total of 43 years for their roles in the shooting, the High Court in Edinburgh heard that plot ringleader Imran Sukar ordered the hit after falling into debt to Mr Demarco.
Yesterday the long-running saga took another twist when Mr Demarco's son, 37-year-old Antony Demarco, provided an explanation far closer to home, pleading guilty at Edinburgh Sheriff Court to a 1 million scam.
Demarco junior said that the casino attack on his father had been retribution for his own unpaid debts to loan sharks who had covered his massive gambling losses.
Just weeks after the murder attempt in June 2008, panicking Demarco used his position as a well-respected financier to steal the huge sum in what he said was a bid to stave off his violent creditors.
By finally breaking his silence over the shooting, the self-confessed gambling addict may have ended the mystery surrounding the attempted murder of his businessman father.
Mr Demarco senior sat stone-faced in court to offer his support, looking on yesterday as Sheriff James Scott refused bail and remanded his son in custody pending sentencing later this month.
Antony Demarco was a self-employed "asset finance broker", essentially a loan arranger. The court heard that the father-of-two was also in the grip of an addiction to online poker, and had run up around 1m of losses that he could not pay.
His defence agent, Joe Mooney, told the court that Demarco turned in desperation to loan sharks in January 2008 to pay off the debts, but failed to keep up with their demands for payments.
Then the seriousness of his predicament was brought into brutal relief when his father was shot in the head outside the casino on 8 June that year.
Mr Mooney told the court: "Various threats were made culminating in the shooting of his father in the head.
"If his father had not been shot he would not have become involved in these activities and trying to repay the moneylenders. He had always been involved in gambling but he had never had to resort to anything like this or anything improper. He gambled from the proceeds of what he earned in his business.
"The family have had to rally around to deal with the implications for his father, who was really an innocent in all of this."
The court heard that Demarco junior began his huge fraud by applying for loans secured against assets that did not exist. As an approved broker, he made a total of 23 fake loans on non-existent assets, swindling cash from financial firms Lombard Finance and Hitachi Capital Finance.
The crooked deals continued for more than a year, during which time Lombard Finance lost 285,000 while Hitachi was taken for 715,000. Demarco's scam was only revealed when Royal Bank of Scotland fraud investigators called in police and Demarco immediately confessed to what he had done.
Bankrupted by the affair, he was forced to surrender his passport amid fears he might have tried to flee the country, and had to report to a city police station every Friday in the months before his court appearance.
The explanation offered in court yesterday may lend credence to Demarco senior's insistence during the shooting trial that he was not owed money by the man convicted of masterminding his attempted murder, Imran Sakur – despite the claims of prosecution lawyers.
During the shooting trial earlier this year, the High Court heard that Demarco senior was owed money by Sakur and that the debt led directly to the murder bid.
Father-of-four Sakur, 35, from Dundee, was believed to have built up huge debts bankrolling a luxury lifestyle with his Eastern European mistress, known in the sex trade as "Erica", showering her with gifts and holidays and setting her up in her own flat.
Prosecutors said this debt was the motive for the attack, claiming that Sakur suffered in a failed 1.5m property deal and lost 40,000 gambling. Witnesses also gave evidence that Sakur owed money to Mr Demarco, although both men directly involved denied it.
"I keep telling you there was no debt," Mr Demarco replied when lawyers questioned his repeated denials.
Instead, Mr Demarco said he had gone to the casino that night to try to patch up a row between property developer Sakur and his associate Shahid Aslam over a business deal which had gone wrong.
Now Mr Demarco's son is awaiting a prison sentence after he admitted obtaining fraudulent credit loans and commissions amounting to 1m between 25 July, 2008, and 31 July, 2009.
The father and son share houses in the same fenced compound at Toscana Court in Danderhall, Midlothian, with the gates outside bearing the words "Casa di Famiglia", which translates as "family home".
It seems clear that arguments over money lay at the heart of the casino shooting carried out just over two years ago.
But it may have been the wayward behaviour of his gambling addict son that put Mr Demarco in the firing line.
43 years for men behind the botched murder plot
FOUR men were jailed for the shooting of Tony Demarco, who was left with a bullet lodged permanently inside his cheek.
Mr Demarco was walking over to his car when he was blasted at close range by a gunman outside the Gala Maybury Casino.
Imran Sakur, who masterminded the hit, was jailed for 11 years, while triggerman Jamie Robertson, 25, from Paisley, received the same sentence.
Unemployed panel-beater Craig Kelbie, 35, from Dundee, was jailed for 11 years for his role as Sakur's "fixer" who recruited Robertson for the job. Getaway driver Francis McGlone, 39, a labourer from Paisley, was given ten years.
Mr Demarco was shot by Robertson while Sakur, who had laughed and joked with the victim beforehand, stood a few feet away. Sakur had relayed orders through Kelbie in an attempt to avoid being linked to the attack.
A trawl through security camera footage by police showed McGlone's car driving around the casino area on the night of the shooting. After a dawn raid on his home, McGlone named Robertson as the gunman in an "off the record" chat with detectives. Mobile phone records linked Robertson first to Kelbie, and then to Sakur, Kelbie's landlord.