Bermuda Housing Corporation last night announced it was suspending general manager Raymonde Dill pending completion of the investigation being carried out by Auditor General Larry Dennis into claims of corruption at the Corporation.

The BHC board acted in the wake of a growing wave of stories about alleged over-payments to contractors, claims in the House of Assembly that kickbacks were being paid, and questions over loans and a mortgage to Mr. Dill's secretary.

The Royal Gazette reported yesterday that a contractor claimed Mr. Dill had given word that the man's staff would no longer be welcome on BHC jobs after the contractor billed Corporation property manager Terrance Smith for work he did on Mr. Smith's home.

BHC chair Valerie Dill issued a statement last night, saying Mr. Dill had been suspended on full pay pending the outcome of Mr. Dennis' investigation, although the board's actions did not imply he was guilty of wrong-doing. She said the suspension had been ordered to `protect Mr. Dill in his professional capacity and to protect the integrity of the investigation'.

Mrs. Dill's statement said: "The board of directors of the BHC has temporarily suspended Mr. Raymonde Dill as general manager.

"Mr. Dill has been relieved of all his duties and responsibilities, with full pay, pending the status of the investigation undertaken by the Auditor General.

"We affirm that the decision of the board does not imply any wrong-doing on the part of Mr. Dill. The board has taken this action to protect Mr. Dill in his professional capacity and to protect the integrity of the investigation.

"The board of directors of BHC recognises the seriousness of the allegations regarding its financial controls. The board would like to reassure the general public that they support the current investigation undertaken by the Auditor General.

"All necessary and appropriate action will be taken upon receipt of his recommendations. The board wishes to encourage anyone with evidence of financial misconduct to direct the evidence to the Auditor General, so that a thorough and objective investigation into the allegations can be had.

"The board affirms that it will continue to carry out their mandate to provide adequate and affordable housing and to promote home ownership for all Bermudians."

On VSB television last night, Mr. Dill, who has been silent throughout the controversy, said he had been told on Monday by the BHC board that he would be suspended pending the conclusion of the investigation.

He said he supported the investigation by the Auditor General. He had made himself available to him and would continue to do so.

"The proper place for any discussions on stories that have appeared in the media lies with the Auditor General. I am anxious that he should conclude his work as expeditiously as possible," he said.

He said there were policies in place when he took over at BHC two years ago for dealing with service providers and where there was a need to address them, the Corporation had had discussions first.

He said he was satisfied that any suitable changes that needed to be made were done consistent with his mandate, and "I am also satisfied that staff were fully aware of the expectations on them" when dealing with contractors.

Where there had been any events to suggest otherwise, action had been taken, said Mr. Dill.

Mr. Dill said he wanted to thank the contractors and service providers who had helped the Corporation in its goal of providing affordable housing and he wanted to "apologise to all those who have been the butt of vicious allegations from a small part of the community".

In yesterday's Royal Gazette Kevin Pilgrim of SOHO Applications said he was kicked off BHC contracts after he tried to bill Mr. Smith for work he carried out at Mr. Smith's home in Tee Street. Mr. Pilgrim said word then reached his men from Mr. Smith and Mr. Dill that they were not welcome on the BHC job. Mr. Pilgrim said he confronted Mr. Dill about this but Mr. Dill denied ordering his men off the job. According to Mr. Pilgrim, Mr. Dill said he had told the head contractor to "keep an eye on them".

Mr. Dill's secretary Leila Outerbridge was quoted in the Mid-Ocean News last Friday as saying she had no loans or mortgages with BHC before November or December of last year. But the newspaper produced documents showing a BHC loan was in her name for $23,002 at the beginning of last year.

And up until October last year four new amounts were added to the loan, totalling nearly $230,000.

Mortgage papers showed Ms Outerbridge obtained the $252,000 mortgage for the property in Cut Road, St. George's, on September 28 last year. Ms Outerbridge was jailed for nine months in 1990 for stealing $22,500 from Warwick Academy, where she worked as a secretary. The Appeal Court upped the sentence in 1991 to two years on the grounds that the sentence was too lenient. Health Minister Nelson Bascome said last night: "I can only support the decision that the Board has made. They have met and discussed the issue and made a decision and that is their prerogative."

Shadow Health Minister Michael Dunkley said last night he wondered why Mr. Dill had been suspended if there was no hint of wrong-doing.

"As far as the United Bermuda Party is concerned, the important issue is getting to the bottom of the allegations. This is one small step the board feels they have to make.

"From day one on the floor of the House of Assembly, we have been calling for a thorough investigation and we hope the Auditor General will do that. Suspending Mr. Dill doesn't have any effect on the investigations.

"The Government has tried to cast the UBP as the villain of the piece for the raising the issue and then the media for running stories. And they denied the allegations from the beginning."