contempt of court. David Fox reports.

Facing possible arrest and imprisonment, a former Bermuda insurance executive quietly slipped into the Island this weekend, after being in the legal wilderness for several years.

Flying in from London was Mark Gregory Hardy, a key figure at the centre of the contentious liquidation of the Focus group of insurers (Focus Insurance, Forum Re and Aneco Re).

He is believed to be involved in legal manoeuvres in an effort to extricate himself from a number of legal restrictions.

Mr. Hardy is seeking to come in from the cold after years of legal troubles that stretch back to the collapse of his Bermuda insurance companies in the early 1990s -- and the mysterious disappearance of nearly $20 million.

But he may be walking a legal tightrope.

In 1995 the Bermuda Supreme Court ordered that a warrant of committal be issued against Mr. Hardy, to show cause why he should not be punished for contempt of court.

Local officials can seize and arrest the former chartered accountant and take him before the court to explain why he should not be sentenced for contempt.

He was in the UK at the time of that decision, and is in Bermuda for the first time since that order was made.

He may this week seek to set aside more than one Supreme Court order against him.

Dating back to when the first company went bust in 1990, Mr. Hardy has been fighting with liquidators in a battle that has stretched from the Supreme Court, through the Court of Appeals and to the Privy Council in London.

After controlling a multi-million dollar insurance empire here and in the US, he denied liquidators' claims that he knew more about almost $20 million that exited his company.

"The whole thing has been a witch hunt from the start,'' he complained at the time.

Mareva injunctions had been issued against Mr. Hardy in 1991, which in effect sought to freeze his worldwide assets, and restrain him or anyone acting on his behalf from touching his assets in any way.

Liquidators later had the courts cite him for contempt of court.

A default judgment was issued in January, 1993 against him when he failed to comply with disclosure requirements ordered by the court.

After being made bankrupt twice in the UK, Mr. Hardy won a discharge of the bankruptcy orders -- one in 1996 and the second this year.

The local court decision followed adjourned civil proceedings against him initiated by David Lines and Peter Mitchell of then Coopers & Lybrand Bermuda, the joint liquidators of the Focus group of insurance companies.

The joint liquidators wanted to have Mr. Hardy declared in contempt of court for "scandalising the court'' in a letter campaign against former Chief Justice Sir James Astwood.

Sir James, now the President of the Court of Appeal, had previously rendered judgments against Mr. Hardy in related matters. Mr. Hardy made unfavourable comments regarding Sir James and Bermuda in widely distributed letters.

He blamed the liquidators for making him bankrupt and the courts for pushing his insurance empire under. His bankruptcy also caused him to be stripped of his professional qualification as a chartered accountant.

The Supreme Court determined in 1995 that the allegations against him of "scandalising of the court'' were proved beyond a reasonable doubt.

The liquidators' lawyers successfully applied to have the matter returned to court after it was clear the Attorney General would not proceed with prosecution.

Lawyer for the liquidators, Saul Froomkin QC of Mello, Hollis, Jones & Martin, said at the time: "If Mr. Hardy returns (to Bermuda) I hope the court will deal with him appropriately, due to the very serious allegations he's made.'' Mark Hardy COURTS CTS