The London boroughs of Harrow and Brent took joint action under the POCA against landlord Vispasp Sarkari.
The confiscation order appears to be one of the biggest ever enforcement fines in recent years, when compared to recent Planning research on use of the POCA.
According to a joint statement from the councils, Harrow Crown Court heard last Friday that Sarkari "had flouted planning rules for more than five years – converting properties across Brent and Harrow into substandard flats without planning permission".
Sarkari’s portfolio included one property in Brent "illegally converted into eight substandard box-room bedsits and four more similarly converted in Harrow", the statement added.
The two local authorities said he "defied all planning enforcement warnings by both councils to stop the use of his properties".
In sentencing Sarkari, Judge Wood described the breaches as "a flagrant abuse of the Town and Country Planning legislation", according to the councils.
The judge ordered that Sarkari must pay £1,500,000 or spend nine years in prison. He was also separately fined £12,000 and ordered to pay both councils’ costs in full.
The councils said Brent Council has also secured a restraint order against Sarkari which means that he cannot dispose of his assets before the order is paid in full. If he fails to pay this, the council can force the sale of his properties.
Harrow and Brent were represented by barrister Edmund Robb of Prospect Law. He said the case "represents major recognition by the crown court of the personal misery and amenity damage which is caused by blatant and longstanding failures by developers to comply with planning enforcement notices issued by local authorities in London".
The boroughs described Sarkari as a "notorious rogue landlord" with a long history of planning and health and safety breaches.
In 2012, a separate confiscation order under the POCA was made against him for £303,112, they added.
Tom Miller, Brent Council’s cabinet member for community safety, said: "Slum landlords won’t be tolerated - plain and simple.
"If you ignore planning laws or leave tenants to languish in poor conditions, then we will find you, we will take action in court, and we will win.
"Anyone we find flouting planning or exploiting renters will feel a deep hole in their pockets after we’ve taken them to task."
Last month, a west London landlord was fined almost £450,000 under the POCA for letting out unlawful 'beds in sheds' at one of her properties.
Also last month, a Staffordshire man was ordered to pay out over £200,000 for running an unauthorised scrap yard in the green belt following a long-running enforcement case, which included action taken under the POCA.
In October, a north London council failed to overturn a Crown Court decision to block an enforcement action that the judge said had the 'improper motive' of gaining 'financial advantage' by means of the POCA.