A businessman has been ordered to pay back almost £100,000 in benefits he used to finance his lifestyle in a £1million Golders Green home.

Father-of-seven Alexander Hye, who made his name in a family-owned international diamond broking business, claimed £525 a week in housing benefit for renting a five-bedroom mansion in Oakfields Road.

He also claimed income support and council tax relief until it emerged that the house was actually owned by Brookfield Property Management, a company registered in the British Virgin Islands, over which he had power of attorney.

At a confiscation hearing at Harrow Crown Court on Monday (March 1), Judge Robert Sich ordered Hye to pay back a total of £97,283 £65,048 in housing benefit and council tax to Barnet Council and £32,235 in income support to the Department of Work and Pensions.

There was outrage this week as it emerged that the house had doubled in value since it was bought by Brookfield and Hye does not have to pay any interest on the benefits he falsely claimed. Hye also escaped a likely jail sentence after presenting evidence that he had a bad back.

"Even though Hye has to repay the money, it's without interest, which is unfair on the taxpayers of Barnet," said Councillor Mike Freer, the council's cabinet member for value. "You sometimes wonder who the courts work for."

Hye said he had been treated unfairly and still disputes that he owns the property. But at Monday's hearing, Judge Sich disagreed.

"Although benefit is not being disputed, the defendant falls far short of satisfying me he doesn't have sufficient interest in that company and property to pay back the benefits he claimed.

"The property is in the legal ownership of a company that was incorporated for the purpose of purchase.

"The principal shareholding is held by another company registered in Delaware in the US.

"The defendant had at one time administered power of attorney in relation to both these companies.

"The equity has increased substantially in the recent housing boom."

Hye, who now lives in a similar detached property in Grosvenor Gardens, Golders Green, was convicted last July of false accounting between May 1999 and October 2001. This week's hearing confirmed that he had the means to pay back the benefits he claimed.

Despite the conviction, he is unlikely to be out of pocket. The court heard that Brookfield Property Management bought the Oakfields Road house for £492,500 in 1998. It is now worth £1m.

At Monday's hearing, prosecutor Andrew Evans argued that compensation should include money he had made during the housing boom.

"The fact that Hye was getting housing benefit paid into his Abbey account effectively meant he was able to pay the mortgage out of another account he held in the name of Brookfield," he said.

But Hye's lawyer Michelle Strange successfully argued that the mortgage was paid from other monies, rather than the benefits.

"Clearly the frauds did take place," she said. "But the benefits were spent on day-to-day expenses. There is not sufficient nexus to suggest this house was bought only because of the offences committed."

Speaking after the case, Hye said he was being victimised. "Barnet Council wanted to make a big attack on me for whatever reason," he said.

"They could have dealt with this very straightforwardly by going to the Appeals Service Tribunal and not to the police. They never talked to me. The circumstances I had were entitled for benefit but the wrong benefit was applied."

He said he would raise the compensation from relatives and friends and added that he would not claim any more benefits from the state.