A millionaire landlord who filed a bogus insurance claim after one of his properties burnt down while being used as a cannabis factory has been spared jail.

Mahendra Shah, 64, rang up Direct Line to take out a new policy minutes after watching the house in Thornton Heath, south London, go up in flames.

The next day he informed Direct Line of the fire and claimed the property was worth £810,000 – although loss adjusters later reduced this to £255,000.

Shah, said to have a property portfolio worth at least £2m, then took Direct Line to the county court after they refused to pay out.

The court struck out the claim, awarded Direct Line £25,000 in costs and reported Shah to City of London police.

Shah was interviewed by the police in March and charged with two counts of fraud. He pleaded guilty to both counts in May.

He was sentenced at the Old Bailey on Monday.

Recorder Brian O’Neill QC described Shah as “greedy” and “dishonest” but decided not to send him to prison after being told of health problems.

Shah, who owns around ten properties in London, was sentenced to 18 months suspended for two years and ordered to pay a fine of up to £46,000, prosecution costs of £400 and a surcharge of £100.

A local paper, the Croydon Advertiser, has now run a story saying that Shah had tried to sue it for defamation, complaining in the high court about articles describing him as a rogue landlord, including a report about one of his properties being destroyed in a fire.

Shah filed papers with the court last year alleging the newspaper had run articles that defamed him. However, the claim was struck out at the Royal Courts of Justice in April and he was ordered to pay £11,592 costs.

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