An accountant who allegedly stole almost $2 million from the Bermuda Government had his guilty plea dramatically revoked in New York yesterday, and may now stand trial instead.

Harrison Isaac Jr. admitted in January that he looted $1,899,888 from a Bank of New York account ? the biggest fraud against Government in history.

However, an 11th hour court battle on the day the 35-year-old Bermudian was supposed to be sentenced saw this plea rejected instead.

Isaac had admitted a conspiracy to defraud Bermuda Government after striking a plea bargain with an agreement that he would testify at the trial of 33-year-old US national Taketa Thomkins ? who maintains her innocence ? and would therefore not face further charges of money laundering.

However, during a tense afternoon of courtroom sparring yesterday, the American government persuaded Federal district judge Laura Taylor Swain to revoke Isaac?s guilty plea.

Lynn Neils, of the US Attorney?s Office of Southern New York, argued that under the plea bargain it was agreed Isaac would specifically admit conspiring with Thomkins.

However, Isaac actually pleaded in what his defence attorney Alexander Eisemann called an ?artful crafting? of words to conspiring with ?persons? ? not naming Thomkins.

The Government said this was not sufficient and the plea agreement was therefore not binding, although this was contested by Mr. Eisemann.

An unshaven Isaac listened clad in prison garb as ? instead of sentencing him as was planned ? Judge Swain ruled that the plea agreement was indeed unenforceable and his plea no longer effective.

She ordered that the Government prepare a new plea agreement to place before Mr. Eisemann by 9 a.m. today.

Isaac, of Crawl Point Lane West, Hamilton Parish, worked as a Management Accountant in the Accountant General?s Department.

He had sole access to the Bank of New York (BONY) account which was set up by the Government to pay vendors in US dollars under post 9/11 financial regulations.

According to the charges, Isaac made unauthorised wire transfers out of it to accounts controlled by himself or a co-conspirator in the US and Bermuda between May 2003 and February 2004.

He arrested in a Police swoop at Bermuda airport on April 15 2004 headed to Atlanta, access cards for the account and handwritten notes stating ?sell everything,? ?liquidate? and ?reset password?.

The two sides will meet again at the Manhattan Federal Court tomorrow, when it will be decided whether Isaac will re-enter his guilty plea under that amended agreement and be sentenced ? or elect trial alongside Thomkins in November.

On the basis of his original plea, Isaac had been said to have faced a maximum sentence of 25 years in prison and a fine of up to $250,000.