Premier Ewart Brown's political campaigner Andre Curtis' company has been named in connection with an alleged securities fraud said to be run by a convicted fraudster and money launderer in the United States.

Daniel Two Feathers is being investigated over claims he and a business partner convinced at least five individuals across the world to invest more than $1 million between them in a scheme falsely promising returns of up to 400 percent per week.

Mr. Curtis, of Harvest Investment Holdings, is described as an authorised signatory for banking purposes for one of Mr. Two Feathers' firms in a document filed by the Securities Department of the Montana State Auditor last month.

The 31-page document contains several references to Mr. Curtis, including one statement that Mr. Two Feathers wrote to him telling him to wire $340,000 worth of bonds called US Treasury STRIPS into a Swiss bank account.

Mr. Two Feathers, his partner Shawn Swor, Harvest Investment Holdings and three other firms are named as respondents in the document.

Mr. Curtis neither answered his telephone nor responded to The Royal Gazette's voice message yesterday, and messages sent to his e-mail address bounced back.

Web-based newsletter Offshore Alert, which broke the story yesterday, reported Mr. Curtis as saying he believed Harvest was no longer involved in the action.

However, the article countered that with a comment from the Montana State Auditor's Office, which said Harvest was still party to the action and that the regulator was seeking financial penalties against the company.

It is the latest controversy surrounding Mr. Curtis after his much-criticised handling of Bermuda's faith-based tourism initiative in 2007/08.

He has repeatedly failed to answer questions over what happened to hundreds of thousands of taxpayers' dollars allocated to Harvest to run faith-based tourism, with just 238 tourists attending the events he spent cash on in the financial year, and preachers from both sides of the Atlantic claiming he didn't pay them.

Auditor General Larry Dennis this summer launched an investigation into Mr. Curtis' relationship with the Department of Tourism.

Mr. Curtis is the chairman of Premier and Tourism Minister Dr. Brown's Warwick South Central Progressive Labour Party branch — and, according to Offshore Alert, Harvest and the constituency share the same fax number.

According to the Montana State Auditor's document, Mr. Two Feathers was charged and convicted in New York federal courts of conspiracy to defraud the US, money laundering and creating or using fictitious obligations in 1999.

He served 41 months in federal prison and was ordered to pay restitution of $5 million.

The latest case came to light this October when a Texas resident alleged Mr. Two Feathers convinced him to invest $100,000 in a deal which would provide a return of 200 to 400 percent.

According to the document, Mr. Two Feathers had promised a return of more than $5 million after 20 weeks' investment. The Texan alleged Mr. Two Feathers would not return phone calls and had run off with the money.

Respondents in the case are Mr. Two Feathers; his firm DTF Consulting Group Trust; Mr. Swor, also of DTF Consulting Group Trust; TLT Holdings Corporation of Montana; DTF Consulting Group; and Harvest Investment Holdings.

Mr. Two Feathers and Mr. Swor are said to be agents for each of the named companies.

The document describes Mr. Curtis as an authorised signatory for banking purposes for DTF Consulting Group Trust as well as director and president of Harvest Investment Holdings.

First Bermuda Securities is also named in the document, which states that DTF Consulting Group Trust opened an account with First Bermuda Securities, with Mr. Swor and Mr. Two Feathers as trustees.

A press release from the Montana State Auditor's Office states Mr. Two Feathers and Mr. Swor used a fraudulent 'line of credit' document to back their scheme, a document they claimed was personally signed by US Treasury Secretary Henry Paulsen and gave them a $1.5 billion line of credit.

It says Mr. Swor also allegedly took $100,000 from one investor in the form of a prepaid loan fee, promising the investor that in return for the fee, Mr. Swor would provide him a $10,000,000 loan. The release states: "The alleged scheme operated by Swor and Two Feathers involved the trading of US Treasury zero coupon bonds, bonds that accrue no interest.

"Investors were told that a $100,000 investment would earn them at least $30,000 a week, with a total return on investment of over $5,000,000 by the 40th week. Investors were instructed to wire funds to various brokerage firms located around the country.

"The Auditor's Office alleges that, instead of trading US Treasury zero coupon bonds as promised, investors' funds were deposited into accounts owned and controlled by Swor, Two Feathers or their companies and then wired bonds and cash offshore to a Swiss bank.

"Once the bonds reached the Swiss account, Two Feathers and DTF Consulting pitched another sale of the zero coupon bonds to European citizens.

"The Department was contacted by one Swiss citizen residing in Poland regarding dealings with Two Feathers after reading the Department's original complaint on the State Auditor's website. Allegedly none of the investors have received any return on their investments and Swor has not provided the $10,000,000 loan nor has he returned the $100,000 prepaid loan fee.

"In late October, the Securities Department sought and was granted District Court injunctions, freezing assets in two of the brokerage accounts used by Swor, Two Feathers and their companies to operate the alleged scheme."

State Auditor John Morrison is quoted as saying: "During these difficult economic times it seems folks are ready to believe they can find an investment that will reap incredibly high returns on their dollars. Our constant mantra is 'if something appears too good to be true, it likely is'. Certainly in this case, it appears things may have been exceedingly too good to be true."

Yesterday, The Royal Gazette e-mailed Dr. Brown and PLP chairman David Burt to ask if they would like to say anything in defence of Mr. Curtis, and whether they thought he should keep his position in the party given the adverse publicity surrounding him.

Dr. Brown is off the Island, but his Press Secretary Glenn Jones replied: "Based on the information you have provided, it appears this matter deals entirely with Mr. Curtis in his private capacity and, as far as I can tell, it does not relate to any business of the Government. "Therefore, comment from this office would be inappropriate."

Mr. Burt described the issue as a private matter. It is understood Mr. Curtis' position in the party will be voted on by members of his branch at an election within the next few weeks.