Bermudian investors appear to be among the thousands caught up in the collapse of a Canadian hedge fund which is now in receivership.

Regulators from across Canada are investigating Portus Alternative Asset Management, founded by Toronto businessmen Boaz Manor and Michael Mendelson two years ago.

Until regulators ordered it to cease opening new accounts or accepting new funds for investment, Portus was one of the fastest-growing hedge funds in Canada, raising $750 million from 26,000 Canadian investors.

In February, court-appointed receivers KPMG were given the mandate to find the money investors placed with Portus funds.

Recent documents filed by KPMG show, however, that the fund?s reach extended to investors offshore including to Bermuda.

The receiver said in documents filed with the court that recovered electronic files of the Portus Group, including various client listings and summaries, indicate that there was a group of investors, comprising approximately 923 accounts, who may have invested up to $68.6 million in International Managed Accounts.

According to the KPMG document, the investors ?appear? to include individuals who live in Bermuda as well as Canada, Hong Kong and Taiwan.

The receiver said that this investigation has found that a separate Asian sales team was established in Toronto by the Portus Group to support the wholesaling of managed accounts to the international investors through intermediaries based in Canada.

The investigation has led the receiver to believe that the account applications and investment funds from some international investors may have been sent directly to the Portus Group?s offices in Toronto, while investment funds from other international investors may have been wired to a CIBC account in the Cayman Islands, the documents said. KPMG is now working with CIBC to trace the funds.

KPMG?s documents also show that Portus had two accounts at the Cayman subsidiary of Bermuda-based LOM (Holdings) Ltd. As at March 4, 2005, there was a combined balance of approximately $37,000 in the two accounts with LOM Securities (Cayman) Limited, said the KPMG document.

Yesterday, a LOM spokesman told this newspaper that while the company cannot comment on the affairs of individual customers, it can confirm that LOM Securities (Cayman) Limited has fully co-operated with the court-appointed receiver.

This newspaper asked whether LOM clients were among the Portus investors.

The spokesman said: ?LOM did not deal with any Portus investors; we are not aware of who their Bermudian investors might be.?

The Globe and Mail reported yesterday that Canadian regulators have noticed the LOM connection to Portus.

Michael Watson, director of enforcement for the Ontario Securities Commission, told the national newspaper: ?Given the history of LOM, its fair to say that it catches our attention when their names come up in this context.?

The LOM spokesman took issue with Mr. Watson?s comment ?given the history of LOM?.

?LOM has never been the subject of any regulatory sanction or negative finding in any of the jurisdictions in which it operates. As a result we have asked our Canadian legal counsel to review and comment on his statement. We also note that the Globe and Mail article incorrectly indicated that LOM is under investigation by regulators in Canada. All previous enquiries by the B.C. Securities Commission have been settled in LOM?s favour; there are no pending regulatory matters in Canada,? the spokesman said.

LOM made Canadian headlines last month after a British Columbia Securities Commission panel rejected a bid by its regulators to issue a cease-trade order against the brokerage.

LOM Holdings and its managing director Scott Lines are, however, currently being investigated by the United States Securities and Exchange Commission over allegations of fraud and market manipulation in its investigation of the trading of three US securities.