A 32-year-old man whose dad used to work for Hyndburn Leisure used a sim card that was issued to the local authority department to set up a mobile phone scam.
Blackburn magistrates heard Gavin Smith used the sim card in his own phone and then received a call from Vodaphone asking if he wanted an upgrade.
And he went on to establish several new accounts, each producing a new handset, and using the accounts to utilise on-line gambling sites, running up a total bill of over £3,000.
Gavin Smith, 32, of Eagle Street, Accrington, pleaded guilty to fraud by false representation.
He was remanded on bail for the preparation of a pre-sentence report.
The court heard Smith had come across the sim card at his mum’s home and had put it in his own phone.
He realised it was subject to a contract which turned out to be with his late father’s former employers, Hyndburn Leisure.
He received a call from Vodaphone asking if he wanted an upgrade and said he did.
Scott Ainge, prosecuting, said: “He realised the account belonged to Hyndburn Leisure and he was able to get the account number.
“He went on line and changed the account so that he was the administrator and over a period of months he added several accounts to the contract.
“With each account he received a new handset.”
Smith used the sim cards to access online gambling sites and used money he received to buy drugs.
“The total bill was £3,124 which has been reimbursed to Hyndburn Leisure but is a loss to Vodaphone,” said Mr Ainge.
Helen Oats, defending, said Smith was extremely remorseful and as soon as he knew something had happened to the account voluntarily went to the police.
Miss Oats said Smith, a former soldier, had managed to get himself off drugs and was looking to get his life back on track.