centre may have been tarnished by a UK political controversy.

Britain's Paymaster General and key Government tax adviser, Geoffrey Robinson, was reported to have transferred $640,000 in assets to Bermuda trust accounts in 1991.

He was urged to give a complete account of his finances when details of the shares, from his property firm Latchuser, emerged this week.

Mr. Robinson has since insisted that he sold his shares to his brother in the UK and they were subject to UK tax -- although they were later transferred to the International Trust Company of Bermuda.

He has now demanded apologies from the Sunday Times and Observer newspapers for carrying the reports.

And Dr. Gibbons said he felt it was "unfair'' that Bermuda was described in UK newspapers as "an effective tax haven''.

The Minister told The Royal Gazette : "In this particular case, as I understand it, there is no implication of anything illegal on Mr. Robinson's part.

"I think the difficulty for Mr. Robinson is that he has a politically embarrassing problem in the sense that the Government has indicated they would like to reduce the possibility of UK citizens using offshore tax structures.

"Bermuda has always had a good reputation in terms of the types of businesses and the types of trust structures we have set up here.'' Tarnished reputation He added that Bermuda, through the new Proceeds of Crime Bill, would move to act on a case-by-case basis if there was any evidence of tax evasion by an investor.

But he said the law would not permit "fishing expeditions'' by foreign tax authorities.

Dr. Gibbons said: "In terms of Bermuda's name, there's always been a propensity by onshore regulators to lump Bermuda in with any number of so-called offshore places that allow tax avoidance.

"I think it's a little bit unfair because Bermuda has always been very careful and we do not have offshore banking, per se.

"We do have trust structures set up here but those are established mostly for very good business reasons.

"There's nothing illegal about them at all.'' Mr. Robinson, who did not face charges of wrong-doing, came under fire for double standards after he announced a UK Government scheme penalising those with more than 50,000 savings.

He is a multi-millionaire and Minister in the Labour Government but was quizzed by Treasury officials after a Sunday Times investigation alleged he had connections with Bermuda trusts.

A statement from Mr. Robinson's solicitors said: "Neither Mr. Robinson nor his wife nor children are or ever have been beneficiaries of any trust in Bermuda or in any way connected with such a trust.

"He sold shares in Latchuser to his brother, who requested that they be sold to the International Trust Company of Bermuda.

"Mr. Robinson sold the shares in the UK and they were subject to taxes on them in the normal way.'' Last week, it emerged that Mr. Robinson was a beneficiary of shares worth 12.75 million in an offshore trust account based in Guernsey in the Channel Islands.

The Sunday Times report said: "Like Guernsey, Bermuda has a reputation as an effective tax haven.''