Businessman Tony Duggan, who slipped out of Bermuda 17 months ago leaving more than $1 million of debts, has been traced to Spain, according to a newspaper report.

He is said to have taken his catamaran Assegai, which he used to flee Bermuda, to the Mediterranean.

The Herald newspaper in Scotland reported yesterday that Mr. Duggan “is understood to be hiding on the southern coast of Spain, after investigators tracked him to one port in the Mediterranean”.

The newspaper quoted an unnamed source as saying: “We believe that he is in Spain, and that the yacht could be somewhere in the Mediterranean.

“What its called now is anybody's guess. The Bank (of Bermuda) would pay money to find out exactly where it is.” Mr. Duggan fled Bermuda in July 2001 shortly after his company Precision Engineering-Technical went into receivership with debts of around $1 million.

Another company, Office Supplies, also went bust and Capital G is pursuing him for an alleged unpaid loan of $893,683. Bank of Bermuda was awarded $528,651 and obtained a worldwide freeze on Mr. Duggan's assets.

Last week, Capital G took out an advert in a Scottish newspaper warning Mr. Duggan of Capital G's action. It listed an address in the remote Scottish village of Meikleour, Perthshire.

The people given at address in Meikleour were listed on the voters' roll as John and Violet Drummond, although a Mrs. Drummond who answered the call denied any knowledge of Mr. Duggan.

Mr. Duggan's lawyer Mark Diel said he did not know where his client was and that they communicated mainly by e-mail.