authorities in the Channel Island of Jersey, alleging regulators there sought to cover-up a scandal involving fraud claims.

And, Dr. Robert John Young, a British currency trader who headed former Bermuda company Anagram (Bermuda) Ltd. has been arrested and his travel documents have been confiscated.

He could face serious charges surrounding the allegations of fraudulent activity involving millions of dollars. News of the scandal was reported in the Wall Street Journal yesterday. The story is reprinted in full on Page 30.

Lawyers acting for Troy Associates Ltd., of which Smith's Parish resident Michael Marsh is a partner with British-born Swiss resident Monica Gabrielli, are seeking the return of $27 million that Dr. Young was supposed to be investing.

But instead of the sum of money appreciating over time, it disappeared.

Mr. Marsh, who personally invested almost $500,000, has been involved with 81 other investors in a two-and-a-half-year battle to determine who was responsible for the losses.

They've already spent an estimated $1 million in legal fees and could see that bill double if their case goes to trial.

The two defendants include a Union Bank of Switzerland (UBS) subsidiary, Jersey-based Cantrade Private Bank Switzerland Ltd., which kept the money in an account under the trustees nominee company name, TTS International S.A.

Suing through the investment manager Troy Associates, the investors have also targeted auditors Touche Ross & Co. UK.

The trustee, Mayo Associates S.A., is also suing the bank and the accountants.

Allegations involve the fact that both the bankers and the auditors had agreed with Mr. Young's claims that he was making gains on the invested money.

But a furious Mr. Marsh said: "We are considering suing the Jersey government. They have a rainy day fund, I understand of $200 million.

"In September, 1994, our lawyers requested that the regulatory authorities there, the Finance and Economics Committee (FEC), investigate our claims of fraud against Cantrade. They refused and, at the same time, gave a licence to UBS.

"And then we found out that the president of the FEC had been a director of Cantrade for many years and should have withdrawn from any decision-making process in this regard.'' Eight years ago, Troy began soliciting money from high-net-worth individuals to be invested.

Troy Associates was the marketer and the investment manager, and subcontracted the currency trading to a professional trader (Young) recommended by the Cantrade bank. The business deal began in 1988. There was no concern.

Cantrade's parent, UBS, came Triple-A rated.

In an agreement with the trustee, Dr. Young was to cease trading if losses reached ten percent of the deposited capital.

But according to recently released documents, the ten percent loss limit had already been heavily breached by 1989 but the bank did not inform the trustee.

In June, 1993, Alfred Williams was introduced during an investment seminar at the Hamilton Princess Hotel as a partner at Touche Ross. At that time, he confirmed that Dr. Young's figures were audited and confirmed.

Executive senior vice president of Cantrade, Peter Stoneman, also gave a speech during the meeting. The plaintiffs claim that both must have known the figures were wrong.

Said Mr. Marsh: "Yet they said nothing and continued to accept new business and recommend Dr. Young's capabilities.

"Dr. Young has been shown to be a fraud. He is a very convincing person with the back up of the Touche Ross audited results of his figures, which were blatant lies themselves. They could only be rubber stamping his figures.'' COURTS CTS