A scrap dealer who bought a series of rare video game consoles says his life has been ruined after one of the world’s biggest gaming companies launched an undercover sting that led to police knocking at his door.

Darius Khan, 32, from Stratford in east London, spent almost £10,000 on prototype consoles and games left behind at Sega’s former headquarters in Brentford – known for its large graphic of mascot Sonic the Hedgehog on the side.

He claims he was offered the consoles and games by a removals firm authorised to get rid of them after the Japanese company moved to new offices in Chiswick.

Among the hoard were development kits, or ‘dev kits’, which are used to test games during production. There were also unfinished games, some of which have never been released. Both are highly prized by collectors and game historians. 

Mr Khan, normally buys up furniture and white goods for export to West Africa, planned to sell the consoles for a profit.

Many dev kits for older consoles such as the PlayStation 3, Xbox 360 and Nintendo Wii often wind up on eBay, fetching hundreds of pounds or more at a time. But experts say sales are potentially illegal.

Sega was made aware that the consoles were for sale on the auction site – by whom, it is unclear – and appointed private investigators to find out where Mr Khan lived.

It kickstarted a saga that may land him and his associates with criminal records – and even time in jail. However, he maintains that he has done nothing wrong.

Darius Khan was raided by police after he bought £10,000 of games consoles and games that were left at the former offices of Japanese firm Sega

Plain-clothes officers from City of London Police in the lobby of Mr Khan’s block of flats in July 2025

Speaking to the Daily Mail, Mr Khan says he was contacted by a man called Paul shortly after listing items for sale on eBay and Facebook.

Paul said he was the father of a severely autistic games enthusiast interested in buying the consoles.

In reality, he was a private eye from investigative agency Fusion 85, which specialises in protecting intellectual property (IP) and lists Nintendo among its previous clients.

He visited Mr Khan and took photographs of the consoles – some of which were explicitly labelled ‘Property of Nintendo – not for resale’ – and games. 

Then Paul went quiet. Weeks later, on July 14, 10 plain clothes officers knocked on the door of Darius Khan’s flat.

The officers were from the City of London Police’s intellectual property crime unit, or PIPCU. While it is part of the Square Mile’s police force, the unit operates nationally to investigate crime such as counterfeiting and trade secret theft.

Alongside police, Sega and Fusion 85 were named on the search warrant as executors, which would have allowed them to attend the raids; it is understood they did not take part.

Police then removed every games console and prototype cartridge that Mr Khan had bought. 

However, they left behind other items such as controllers, cables and other merchandise such as autographed copies of games for reasons that remain unclear.

Seven months on from being ‘frogmarched’ to a police car, interviewed and held for eight hours, Mr Khan is yet to be charged with a criminal offence.

He says his plans for a new business have been ruined, and that he no longer feels safe in his home. He is also unlikely to see the £10,000 again.

‘This is probably the worst seven months of my life. It’s caused unbelievable levels of stress between me, my friends and my neighbours,’ Mr Khan told the Daily Mail.

‘My neighbours don’t talk to me anymore – if you see 10 police officers raid your neighbour’s house your instant assumption is that they’ve been up to no good.’

The probe came about after Sega’s former offices in Brentford, West London were cleared out (pictured with mascot Sonic the Hedgehog on the side) 

A pile of game consoles, cartridges and controllers left behind at the Sega offices after the company had moved

The row, it appears, has unfolded amid confusion over the ownership of the consoles and memorabilia.

Experts in IP law have told the Mail that dev kits are lent to firms like SEGA by manufacturers such as Sony, Microsoft or Nintendo under watertight legal agreements that forbid their redistribution. 

In the wrong hands, the machines can be reverse engineered – enabling the pirating of games. 

Developers are meant to return dev kits when they are no longer required, such as when a console is superseded by a new version, to stop this happening.

However, many regularly end up on eBay, where they fetch hundreds if not thousands of pounds. Collectors say this is due to lax disposal procedures.

Mr Khan believes that he was legally able to buy them because they had effectively been abandoned by SEGA. 

He also believes that his right to claim them as his was borne out when police asked him sign a form relinquishing their ownership. He refused. 

‘Some of the consoles were completely dead. I just assumed they were scrap and that they didn’t want them.

‘The police seized cartridges and consoles but didn’t touch other things from the office like cables and controllers.

‘Someone within SEGA made a mistake, or something’s gone on where items that shouldn’t have been disposed of have ended up being disposed of.’

Unbeknownst to him at the time, there may have been an error on the part of his contact – a subcontractor for ‘ethical office clearance’ charity Waste to Wonder who had told him the devices and games had been left behind for disposal.

Sources say an on-site manager told Waste to Wonder workers to clear out everything, including the consoles and games. But it later emerged SEGA had appointed another firm, ITR Secure, to dispose of computers and IT equipment.

Consoles and controllers bought by Darius Khan in the clearout. The Nintendo console (right) bears a sticker reading ‘not for resale’ – but he disputes its legality

The £10,000 haul included development kits for consoles that are no longer made, including the Nintendo DS (pictured: dozens of development kits) 

Those with knowledge of the clearout insist that this was not communicated to workers on the ground – including Mr Khan’s contact, who was later sacked. He was also arrested as part of the PIPCU probe.

One source said: ‘They were told they had to take absolutely everything from there, but in reality that was not the case.’

Michael Amos, managing director of Waste to Wonder, told the Daily Mail that he did ‘not know’ how the clearout had unfolded, but denied that workers had been told to remove IT equipment.

Responding by email, he said: ‘It was a subcontractor, IT was not in scope and we never allow subcontractors to sell items. We no longer work with that subcontractor.’

He declined to answer further questions on the specifics of the clearout. ITR Secure did not respond to requests for comment.

The matter is further complicated by allegations that some of the items bought by Mr Khan allegedly belonged not to Sega but to a former employee, Danny Russell.

He has a separate civil case against Sega proceeding through the courts, and declined to comment when approached by the Daily Mail.

The case has sparked a debate over dev kits – which gaming fans say are an important part of gaming history.

Damien Farnham, who runs the Videogame Preservation Museum (VGPM), told the Mail kits regularly find their way into the hands of enthusiasts despite iron-clad contracts because game developers take a dismissive approach to disposal.

‘Consoles are supposed to be returned or destroyed, but this (approach) doesn’t actually ever work. They always end up online,’ he said.

The VGPM was set to buy some of the consoles Mr Khan was selling before the police investigation began. Mr Farnham holds the view that preserving consoles earmarked for disposal should be lawful. 

‘I know, for instance, Microsoft has sent dev kits to be destroyed, and they’ve ended up for sale in China a few years later,’ he added.

Mr Khan – pictured with his letter informing him he is under investigation – maintains he has not committed any crime

One of Mr Khan’s consoles for sale on eBay – before SEGA sent a private detective to his home

Research by the Daily Mail found that many development consoles regularly wind up on the auction site – fetching three and even four-figure sums

‘And then the community gets hold of them, and then Microsoft ask, “Well, how did you get this?” They think it’s stolen.

‘But at that stage, they’ve already disposed of it, which, in my eyes, once you’ve disposed of it lawfully, you’ve renounced ownership to that item.’

Even older consoles such as the Wii, Wii U and DS, which were among those Mr Khan bought, are protected – something video game archivists like Mr Farnham oppose.

He argues that the machines and the data on them can have huge historical value. Gaming companies do not, he claims, take preservation seriously enough, prompting fans to step in. ‘We’re doing it to save history,’ he added.

Regardless, Mr Khan’s wait to find out if he is to be charged with a criminal offence continues. 

He feels he is being singled out for someone else’s mistake: either SEGA for leaving items behind it should have taken away, or Waste to Wonder, for not enforcing a more stringent clearout (it denies any wrongdoing).

He has lodged his request for a judicial review of the warrant at the Royal Courts of Justice, naming City of London Police, SEGA and Fusion 85 as respondents; a complaint is also sitting with the police force. 

He accepts he is unlikely to see his £10,000 again – but insists he has not committed any crime and that the matter could have been settled via civil means had Sega made contact.

‘Sega could have turned around and said, “Look, we’ll give you 40 grand, we’ll buy them off you”,’ he said. 

‘Forty grand is nothing. That’s an accounting error to Sega. They could have resolved this situation so well.’

He added: ‘I know I haven’t done anything wrong. I’m not going to stop fighting.’

A City of London Police spokesperson said: ‘We can confirm that an investigation is currently ongoing in relation to the alleged possession of criminal property.

‘Three people have been arrested and four interviewed voluntarily in connection with the matter. They were all released under investigation pending further enquiries.

‘We have received a complaint in relation to the investigation, which is currently being reviewed. It would not be appropriate to comment further at this time.’

A Sega spokesperson told the Daily Mail: ‘Sega will only be in a position to comment once the investigation, and any potential legal matters arising from that, have been concluded.’

Fusion 85 did not respond to repeated requests for comment.