to fraud that involved millions of dollars, could be back on the streets by the end of next year.

And a leading Bermudian chartered accountant, Mr. David Lines, has declared that the Habib matter is still not fully resolved.

Habib, a former Bermuda businessman who deceived insurance regulators in Bermuda and two US states, swindled clients out of at least $5 million and even deceived his company's own Bermuda auditors, was sentenced in a Manhattan federal court at the end of July.

Habib last November pleaded guilty to defrauding mostly California and Illinois motorists and small businesses which purchased insurance underwritten by Bermuda-based Financial Services Insurance Ltd. (FSIL).

Habib was the head of FSIL and related New York company, International Investments Financial Services (IIFS) Inc.

He was sentenced to 52 months in prison, ordered to pay $2 million in restitution to the victims and fined $10,000.

But Habib has been in US custody since April 1, 1993 and his prosecutor, Assistant United States Attorney, Mr. David Lewis, has confirmed that there is a possibility that Habib could be free within 17 months.

The court has allowed the 28 months Habib has spent in custody to be taken into consideration. Habib may also be eligible for a reduction of about 15 percent (54 days a year) of his time for good behaviour.

The court ordered that the $2 million restitution should be re-paid within five years, an indication of what the court believes Habib would be able to re-pay, even though the court had found that losses to the victims exceeded $5 million.

Meanwhile, Mr. Lines, senior partner at Cooper & Lines/Coopers & Lybrand (Bermuda) said that he is glad that the authorities were able to capture and convict the confidence man.

Coopers were the auditors for FSIL and were among a long list of officials and agencies who were deceived into believing that FSIL had a US Treasury note and bond portfolio backing it, amounting to more than $50 million. No such portfolio existed.

Mr. Lines said: "I'm glad that he has been caught and found guilty, but I'm not sure that everything is resolved because his company was trading and he misled a lot of people, including ourselves.

"That still has to be unscrambled. I don't know how that will be unscrambled.

It's a sad day when there are people in collusion. But I'm delighted that the people in the US have prosecuted him and convicted him.

"In international trade, when people commit such crimes, we need to see them convicted.'' Mr. Lines would not be drawn on whether or not Mr. Habib's firm still owes an auditor's bill.