Gerard Raffell, aged 42, agreed to pay £18,000 to the parents of a four-year-old boy's he had sexually abused, for a deposit on their new home.

Northampton Crown Court heard he handed over the money, agreed to leave his teaching job and moved away when the abuse first came to light.

He had been repeatedly sexually abusing the youngster but it was only reported to police last year when he told school staff.

Judge Ian Alexander said: "This case is very different to the one I thought it was. I am staggered. I have never come across this before and I am not sure how it affects the sentence. He has effectively been fined £18,000 outside of the judicial system"

Stuart Yeung, prosecuting, said Raffell was trusted to look after the boy but began sexually abusing him. At the time he was a maths teacher.

And when the victim's family discovered the abuse, they did not contact the police but insisted Raffell move away and leave his teaching job.

He said: "The victim tried to put matters behind him and never saw the defendant again because he moved away to live in Coventry.

"He also promised never to tell anybody about the abuse."

Yet last year, the boy, who cannot be named for legal reasons, disclosed how he had been sexually abused and the police were called in.

Raffell, now of Witherford Way, Birmingham, was still teaching when he was arrested and was found with up to 50 indecent images of children saved on his computer. He later pleaded guilty to four charges of inciting or causing a child into sexual activity, between 2002 and 2005.

He also asked for seven offences of making and possessing child pornography to be taken into consideration.

Hena Vissian, mitigating, said Raffell paid over the money after being approached by the boy's family. She added: "It was suggested the money would assist the family and he felt guilty about the situation so handed it over."

Judge Alexander adjourned sentencing, remanded him in custody, adding: "I make no promises about what the eventual sentence will be.