bank accounts in Bermuda, it has been alleged.

Both the Federal Bureau of Investigation (FBI) and the Securities and Exchange Commission (SEC) are reported to be investigating possible shady business links between Bermuda and a failed Los Angeles-based company called Financial News Network (FNN).

It is alleged that top FNN executives took part in widespread financial fraud involving up to $50 million, with much of it ending up in Bermuda.

FNN is a shareholder in Bermuda-based Intex, which was put into liquidation last month with net debts of more than $1.6 million.

FNN, which filed for Chapter 11 bankruptcy protection in March, 1991, was run by controversial American businessman Dr. Earl Brian, who was chairman of Intex between 1984 and 1988.

It is understood that he still controls some shares in Intex, although Dr.

Brian denies this.

The FBI will not confirm or deny any ongoing investigation, but a former Canadian stockbroker, who did not want to be named, said he had been helping them with their inquiry into Dr. Brian since February, 1991.

He said the FBI's investigation centres on an allegation that FNN paid $8 million to Intex a few years ago for the purpose of being siphoned off into secret bank accounts.

According to the source, the money was disguised as bogus lease payments.

Details of the SEC's investigation were revealed in a Los Angeles County Superior Court last year when a lawsuit was started against FNN by some of its stockholders.

Both the lawsuit and the SEC's investigation involves an allegation that top executives at FNN siphoned company money to Bermuda bank accounts through associated companies on the Island.

At the same time, the lawsuit claims that the executives deliberately ran FNN to financial ruin.

The lawsuit alleges that the company was defrauded of up to $50 million, much of which is said to have gone to offshore bank accounts, primarily in Bermuda.

Dr. Brian, who has had several business failures in the US, said last night: "I am unaware of any FBI investigation of myself or of Intex.

"I have never been interviewed by the FBI regarding Intex or any of my personal business activities.'' He added: "Intex has been audited by internationally recognised public accounting firms for every year in which it had any significant business.

"It also underwent the due diligence investigation process by a major investment banking firm with regard to its business activities.

"There have never been any allegations of impropriety regarding the funds to and/or from Intex during its existence.'' According to the source helping the FBI, though, FBI investigators have interviewed Briton Mr. David Thompson, Intex's former chief financial officer, who currently runs the Larmag Energy Group, in Bermuda.

Mr. Thompson, however, denied that he had talked with the FBI, saying: "I'm not aware of any investigation by them into Intex.'' Mr. Thompson denied that Intex, which was formed in 1982 to develop computer software for international futures trading, was involved in any illegal activities.

"I had many dealings with Brian,'' said Mr. Thompson. "He was my boss for three or four years. I liked the man. He was very intelligent and I had a lot of admiration and respect for him.

"I don't know of any dealings he's had which are illegal or not kosher. I have certainly not been involved with anything like that. The books and records are available for inspection.'' He said Dr. Brian was invited to become chairman of Intex about a year after it formed because it was already in serious financial trouble.

"The company was bankrupt even in 1983,'' said Mr. Thompson. "We did not raise enough money when we started. The whole thing was in danger of collapsing; there were disputes with everyone and everything in disarray.

"Earl Brian was a specialist in raising venture capital. When Intex was going through one of its many, many crises the principals of Intex, Eugene Grummer, Wallace Sellers and Junius Peake, contacted Brian to help out and raise money.

"He became involved for a short period of time to try and turn the company around. He raised some venture capital to put Intex back on keel.'' Dr. Brian resigned as chairman in 1988, said Mr. Thompson, who added: "Venture capitalists are not the sort of people who make life-long careers.

"There was a point in time when probably there were more important deals for him to be involved in.'' Mr. Thompson himself quit in December, 1991, because "I had not had a salary for three months.'' Intex was put into liquidation last month with liabilities of $1.85 million and assets of just $243,175, according to the firm's unaudited statement of affairs.