Corporation of Hamilton officials are remaining tight-lipped over concerns that they have handed over thousands of dollars to a bankrupt organisation.

The Royal Gazette revealed that the US-based National Conference of Black Mayors — which is holding a municipality-funded conference on the Island later this year — had gone into liquidation owing around $1 million to a long list of creditors. City Hall has signed a contract with the Conference of Black Mayors — an offshoot of the parent organisation — to host its 40th annual gala in October, and controversially agreed to pay the group $100,000 to cover organisational costs.

Documents show that the CBM was set up independently by Vanessa Williams, the disgraced former chief executive officer of the NCBM who was sacked by that group after it was discovered she had spent more than $600,000 of NCBM funds on personal expenses. The group went heavily into debt under her leadership.

Following her dismissal, Ms Williams continued negotiations with the Corporation for a Bermuda convention, claiming that, although the NCBM had changed its name to CBM, the new body was the same organisation.

That claim has been accepted by Hamilton officials. On Wednesday — before news of NCBM’s bankruptcy had been reported — Deputy Mayor Donal Smith said the NCBM was “in the hands of the president of the CBM”. Mayor Graeme Outerbridge added that confusion over the two groups had arisen simply because the NCBM had decided to change its name to CBM.

“From the point of view of being a split organisation, it’s actually an organisation of both bodies,” the mayor said, adding that he had investigated the CBM’s background and credibility “very carefully”.

And Councillor Keith Davis also pointed out that the confusion had arisen after the NCBM membership voted to change the organisation’s name in 2011.

The Corporation has already handed over $50,000 to the CBM, although City insiders claim the event could eventually cost the municipality $350,000.

The Royal Gazette made several attempts to contact Mr Outerbridge, Mr Smith and Mr Davis and also Home Affairs Minister Michael Fahy, who has come out in support of the convention and authorised Corporation of Hamilton payments to the CRB.

This newspaper asked if there was concern that any CBM assets, including cash payments from City Hall, could be seized by the bankruptcy trust that is now overseeing the NCBM’s affairs.

Nobody from either the Corporation or Government responded to e-mail and telephone requests for comment.