Police yesterday confirmed they are carrying out inquiries into the alleged misuse of company funds amid reports that a telecoms employee gambled £1m betting online.

It is understood that the person at the centre of the inquiry is 25-year-old Chris Proudfoot who worked for HIGHnet, a business communications provider based in the Longman industrial estate, Inverness.

A spokeswoman for HIGHnet confirmed that Mr Proudfoot no longer worked for the company, but added: "That's basically all we can say given there is a police investigation under way."

She would not say when Mr Proudfoot left the firm but it is understood he was sacked last month after having been with them for a number of years.

Northern Constabulary would not confirm that the money had been lost on an online gambling site, believed to be that of bookmaker William Hill.

A police statement said: "Inquiries are at an early stage and are expected to go on for some time as a substantial sum of money is believed to be involved."

A spokesman for William Hill said "This is a case that could potentially come to court but at this moment is largely unsubstantiated, so we wouldn't want to make any comment. We don't comment on clients' accounts anyway."

There is a fear that gambling is dramatically increasing with the advent of online sites.

In 2005, Richard Mahan, from Aberdeen, gambled using details of 13 credit cards belonging to his parents, won £90,000 in the first hour and then proceeded to lose it plus an additional £68,000.