Iain Shepherd forged his wife’s signature to set up a secret bank account to secure Joshua Powell’s inheritance after the death of the boy’s father, Stephen Powell – who had previously been ‘a close friend’ of Shepherds in the navy.
Over a three-year period the disgraced Lieutenant Commander pocketed £58,895.78 from Joshua, who has learning difficulties and was only 10 when the fraud first began in 2006.
The 65-year-old’s scam was only exposed a decade later by his wife, Mary Shepherd, after she became suspicious.
And now he has been jailed for three years and eight months after pleading guilty to fraud.
Speaking outside Portsmouth Crown Court with her son – now aged 23 – Mrs Shepherd, of Chichester, said: ‘He is absolutely despicable. What he has done is beyond words. He is a heartless, callous, sociopath. He is the lowest of the low and deserves to be in prison.’
During his sentencing hearing in Portsmouth, the court heard how Shepherd, of Aldwick Road, Bognor Regis, had been bankrupt when he took charge of Joshua’s money – £83,255.82 in all – in December 2006.
Within days the scheming Falklands veteran, who served 21 years in the navy, had transferred the money to a secret account under his wife’s name, using a signature he had faked, and began siphoning off the cash.
Prosecutor Mike Mason said Shepherd transferred ‘numerous’ cash sums, ranging from £200 to £300 as well as larger amounts of £5,000 to accounts overseas in Italy, between December 2006 and February 2010.
During his crime Shepherd had been ‘living a second life’, running his own business, Marcom Defence, in Chichester, and acting as the president of the Chichester Chamber of Commerce.
He later became an EU ‘ambassador of the sea’, a job which saw him working with the European Commission on the continent’s overall maritime strategy – a role which contributed to him being awarded MBE in 2015.
The fraudster’s actions came to light after he was reported to the police by his wife in 2017, at which point Mr Mason said Shepherd admitted owing Joshua at least ‘£80,000’ in payments and interest.
‘He not only failed to safeguard Joshua’s interests but he has taken his money for his own use,’ Mr Mason told the court.
Representing himself, Shepherd vowed to pay back the cash by selling off valuable ‘electrical components’ he owned.
Speaking from the dock, he added: ‘I apologise unreservedly to everyone that’s been affected by this, which I’m truly sorry. What I did was firmly dreadful.’
Sentencing, Judge William Ashworth said Shepherd should have never been allowed to be a trustee having been bankrupt at the time.
‘This was a clear abuse of trust,' he added. ‘It was calculated with an aspect of greed.’
Shepherd, formerly of good character with no previous convictions, was jailed for three years and six months for the fraud and a further two months additionally for one count of failing to surrender on two separate occasions.
He was ordered to pay £19,497.70 in compensation.