Melbourne racing identity Bill Vlahos, 54, admitted to defrauding gamblers of $17.5 million between 2008 and 2013. He pleaded guilty in the County Court of Victoria to two rolled-up counts of obtaining a financial advantage by deception in court on Monday.

Judge Douglas Trapnell initially planned to revoke bail, but later made an allowance for Mr Vlahos to spend summer with his family after defence lawyer Justin Wheelahan said his client did not pose a danger to anyone or offend anyone while on bail. Bail was agreed, but Judge Trapnell said that it was “inevitable” that the father of two would go to jail.

Mr Vlahos pocketed money gamblers invested in The Edge punters’ club which folded in 2013. Court documents show that 35 syndicates involving 68 people were caught up in the scam, referred to as a “Ponzi scheme”.

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Mr Vlahos had previously denied charges, but formally pleaded guilty on the day his trial was listed to begin. Judge Trapnell questioned why Mr Vlahos was pleading guilty to only two charges, and he questioned whether the plea deal defeated the purpose of the legislation which allows an offender to be sentenced for a continuing enterprise.

Prosecutor Deborah Mandie explained that a senior prosecutor had decided to proceed on two charges “in the interests of resolving the matter.”

Police and prosecutors will need to contact and receive victim impact statements from all the syndicate members caught up in the scam, a process that is expected to take months.

Mr Vlahos, who listed his occupation as a carer, is due to return to court on 4 February for a pre-sentence hearing.

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