Bank accounts in Dubai linked with Bermuda-based oil trader John Deuss? First Cura?ao International Bank have been frozen as part of an ongoing operation by British and Dutch authorities to end an alleged complex cross-border fraud scheme and retrieve billions of dollars of lost tax revenue.

Mr. Deuss? Caribbean bank, which is also the largest shareholder in Bermuda Commercial Bank, is suspected to have been used by fraudulent traders to stash hundreds of millions of dollars in illegal tax gains that resulted from an alleged ?carousel trading? scheme.

The scheme involves the repeated importing and exporting of small items such as computer chips and mobile phones, free of value added tax (VAT), to then be sold and the VAT pocketed by the seller rather than given to the relevant government.

Mr. Deuss, 64, who has been a Bermuda resident for 30 years, remains in Holland where he was voluntarily extradited last October and subsequently released on a 2.5 million Euro bail with his passport surrendered so he can not leave the country while the international investigation continues. Mr. Deuss has maintained his innocence in the matter.

The European clampdown on the alleged carousel trading and attempts to recover the money that has been illegally gained continues.

On Tuesday nine people arrested in the UK were charged in connection with a HM Revenue and Customs operation into a claimed ?250 million ($490m) VAT fraud.

Speaking to a UK House of Lords? European Union sub-committee A, this week the UK Paymaster General Dawn Primarolo said efforts to contain the fraud had led to a ?massive drop? in levels of attempted fraud since summer 2006.

According to a London newspaper report, the focus for the UK Government is now to recover some of the billions of dollars alleged to have been stolen through the claimed fraud system.

It is believed much of the unpaid tax money has ended up in Dubai, where accounts linked to Mr. Deuss? Caribbean bank have been frozen as the investigations continue.

Mr. Deuss, who is originally from Holland, has been quizzed by the Dutch authorities in connection with an alleged international tax scam.

His company Transworld Oil has an office in Flatts Village and Mr. Deuss stepped down as chairman and chief executive officer of Bermuda Commercial Bank last September after news of the investigation became public.