Telecommunications officials have to face another battle in the war with an illegal callback company after it emerged yesterday that customers could use its service by dialling through the internet.

Despite Government cutting off GlobalTel's telephone lines twice, preventing customers from dialling overseas using the cheap phone service, the callback scheme can be used online.

A member of the public told The Royal Gazette that although the illegal service, which is used by hundreds of people across the Island, went down at the weekend, it was not completely out of action.

He said he called the service through the Internet, and in turn it called him straight back with an open telephone line.

Government has only been able to stop customers calling out of Bermuda, but GlobalTel is still able to call them with a line.

And yesterday The Royal Gazette accessed the online service, too.

Hiram Edwards, Government Telecommunications Officer, has been investigating the aggressive way GlobalTel has continued to operate in Bermuda since the ban was introduced in mid-December.

Yesterday, Mr. Edwards said he did not realise the callback service could be used on the Internet, but said it would be investigated now.

However, he said it was still illegal because GlobalTel was not licensed to operate here in any shape or form.

He said the information about the Internet access would also be included in a file he is set to present to the Federal Communications Commission (FCC) in the US, which licenses GlobalTel.

All telephone companies in the US must have an FCC licence to offer an overseas service.

He added: "I was not aware of that angle, but it is certainly something we will look into.

"No matter which method they use to operate in Bermuda, they are still flouting the laws. It is illegal.

"There are companies that offer a long distance phone service on the Internet, such as Logic, but the difference is they are licensed. We are investigating this thoroughly, but we have to bite off little chunks at a time. It is a slow process.

"It is a challenge, but all of the avenues will be addressed.'' Minister Renee Webb was instrumental in banning the three callback companies from the Island in a bid to support Cable and Wireless and TeleBermuda International who pay license fees and are based here.

Callback companies are based overseas but use the infrastructure in Bermuda, which is paid for by local firms, to provide a service.

As a result of Government efforts, the cost of legal overseas calls to the UK, US, Canada and Ireland, have fallen.

The FCC said they advertised on their website and in their literature those countries that have banned callback services, such as Bermuda. And the FCC stipulates that callback firms should only operate where they are welcome.

After the FCC receives a complaint about a company, its usual procedure is to contact the firm in question and inform or re-iterate that a ban is in place.

If they continue to fragrantly flout the ban, then the FCC can withdraw their licence to operate an overseas service, if they feel it is warranted.

A number of calls and e-mails made to GlobalTel at its head office in New York by The Royal Gazette have not been returned, and yesterday a GlobalTel main switchboard answer machine said there was no room left on the tape to leave messages.

The company is facing allegations that it is being deliberately aggressive and malicious in its resolve to continue operating on the Island.