another blow yesterday when a Berlin-based anti-corruption agency labelled it as one of the world's "banking outlaws'' against which international action should be taken.

Bloomberg news yesterday reported that Transparency International (TI), a non-profit agency, called for a crackdown against places which make it easy for money from ill-gotten gains to be laundered.

TI chairman Peter Eigen specifically named Bermuda, the Cayman Islands, the Isle of Man, the Channel islands and Antigua, Liechtenstein, Luxembourg, Monaco and Switzerland as "prime destinations for illegal funds''.

"Many of these so-called rogue offshore financial centres exist largely on the handling of illicit wealth,'' he said in a statement. "Excluded from the international banking system, they would be far less profitable as businesses.'' He also said banks that don't adhere to "agreed international standards of supervision, transparency and assistance in investigations'' should be shut out of the international banking system.

"The current situation is as indefensible as it is unacceptable,'' he said.

Earlier this week Bloomberg reported that fraudsters had used the Island to stash about $10 million in assets bilked from investors. Cleveland-based Options Trading Inc. reportedly used telephone sales and fraudulent statements to entice 430 investors to buy about $20 million in currency options.

And this year a former derivatives salesman Frank Partnoy, in his book F.I.A.S.C.O.: Blood In The Water on Wall Street, stated that four Bermuda charities were unwittingly used by American investment bankers Morgan Stanley for escaping tax in marketing derivatives overseas.