offshore banks after allegations in a newsletter run by a former Royal Gazette reporter.

Grenada's government has asked the FBI and the British Intelligence Unit to investigate, Prime Minister Keith Mitchell announced.

The move follows charges in the Miami-based Offshore Alert financial newsletter that First International Bank, owned by Van A. Brink of Oregon, was involved in an international scam.

Offshore Alert, which has broken several scandals in the Caribbean offshore industry, alleged that together with other offshore banks in Grenada and elsewhere, First International was securing millions of dollars in deposits to a non-existent Grenada-based stock exchange.

Inquiry launched into offshore bank The former British colony has no stock exchange.

A receptionist at the bank yesterday said neither Brink nor any other official was immediately available to comment on the development. The bank last month failed in an attempt to stop publication of Offshore Alert, publisher David Marchant said from his Miami office. Mr. Marchant is a former business reporter with The Royal Gazette .

The bank has previously denied the charges, which come amid growing pressure from Britain and the United States for several Caribbean islands to tighten legislation of the secretive offshore industry, which critics say has become a haven for profits from illegal drug-smuggling and other criminal activities.

"It is our duty to protect the good name of our country and our job is to investigate the reports we have,'' Mitchell said in a statement broadcast on Monday on the government-owned Grenada Broadcasting Network.

At first, Grenadian officials had downplayed the allegation. The registrar of offshore companies, Michael Creft, said in an affidavit that there were "no suspicious circumstances'' surrounding First International.

Mitchell said the government has asked the US Federal Bureau of Investigations and the British Intelligence Unit to investigate. "We have asked our international friends to investigate and provide us with information, so we are awaiting word from them,'' he said.

First International is one of several offshore banks and Internet gambling companies established in Grenada since Mitchell was elected in 1995 and made Grenada an offshore banking centre.