Benefits cheat asylum seeker had £500,000 in the bank and drove a Mercedes - but was caught out by wife's fur coat

But, in reality, failed asylum-seeker Massoud Montazery had £550,000 in the bank, wore designer clothes and drove top-of-the-range cars.

The 29-year-old conned benefits staff into paying him nearly £25,000 before his lies began to unravel.

An immigration officer spotted him at the wheel of a Mercedes wearing expensive clothes with his wife in the passenger seat dressed in a fur coat.

He remains at liberty, however, to spend the fortune which is believed to have come from relatives.

A judge at Liverpool Crown Court decided not to jail him, despite labelling him 'dishonest', or order his deportation.

Instead, Judge John Phipps imposed a suspended jail sentence of nine months and ordered him to do 100 hours of unpaid work to be followed by a two-year supervision order.

Montazery was also found to be working illegally as a salesman for a babywear company.

He had arrived in Britain with his wife in 2001 and claimed asylum. He alleged he had no nationality documents and was being pursued in Iran for belonging to an opposition party.

His claim was rejected but he appealed. After telling immigration staff he was destitute, the couple were given income support and help with housing costs and other bills.

They moved into a house in Liverpool where their first child was born. Their second is due in April.

Montazery's appeal was turned down and the couple had to report regularly to the local immigration office.

A worker there is believed to have tipped off investigators in 2005 after seeing him waiting outside in the driver's seat of the Mercedes.

Fraud investigators went to their terraced house in Walton and were surprised to see a Jaguar X-Type and a BMW in the run-down street.

Montazery, who asked them to remove their shoes so they did not spoil his new carpet, claimed one car belonged to his sister while the other had nothing to do with him.

Expensive-looking ornaments dotted around the living room were being looked after for relatives, he insisted.

Montazery also denied having a bank account. But investigators discovered that he was working and had two bank accounts containing more than £550,000.

Montazery was arrested and admitted two counts of making false statements to obtain benefits.

In court, the judge told Montazery he had lied to the authorities, adding: "A huge amount of public money is spent on benefit, which comes from the public purse to which every taxpayer contributes."

Montazery has one previous conviction for using a motor insurance document with intent to deceive for which he was fined £250 in 2006.

Yesterday Gill Mortlock, regional director of the Border and Immigration Agency, said: "Mr Montazery is an educated and intelligent individual who has abused the hospitality of this country over a number of years.

"The UK has a proud record of helping those in genuine need, but this individual has abused the system for his own personal greed.

"Those who engage in fraudulent claims should be warned that we will seek them out and prosecute them."

As the court did not order Montazery's deportation, the agency will start "removal" proceedings after he has completed his sentence.

This includes the threat of detention for him and his family.