Trading room tapes of telephone conversations central to the $1.3 million Bank of Bermuda case in Guernsey have vanished, the English High Court has been told.

Daily British broadsheet newspaper The Guardian reported yesterday that a key witness in the case claimed the tapes would have proved conclusively whether huge losses incurred by investors were caused by rogue trading.

And they would have also proved if the losses incurred were the result of instructions from the investors themselves.

The bank is suing Henry Fink, the investment advisor of seven wealthy investors who lost $2.8 million in a disastrous series of foreign exchange speculations in 1992, for a 400,000 guarantee.

And Mr. Fink is counter-suing to have the guarantee set aside.

The group pooled together about 1.5 million and deposited it into a fund with the Guernsey branch of the Bank.

Within several months the account was $1.3 million in the red.

At the heart of the court case is whether the losses were the fault of investment advisor Mr. Fink or the result of some sort of rogue trading by unnamed persons at the Bank.

The Guardian reported that on day two of the hearing Mr. Fink was accused of trying to evade the issue of whether the loss-making deals were his responsibility.

Mr. Fink told the judge, Mr. Justice Bell, that he was giving instructions to the bank on behalf of his seven investors but also giving general advice regarding future movements in currencies.

But he said the bank's tapes of his calls to chief dealer John Marquis were incomplete and had jumbled up these conversations.

The tapes produced by the bank contained his general advice rather than his instructions specifically on the funds of the seven investors, he said.

Mr. Justice Bell asked Mr. Fink the identities of the bank clients for whom his advice was sought, other than the seven investors.

But Mr. Fink said he had no idea as none of the banks to whom he had given general advice made a practise of telling him which clients it was used on.

The bank's legal counsel Philip Brook Smith said the claim that the bank had taken Mr. Fink's advice on foreign currencies separately from his role as an investment manager to the seven clients was "complete nonsense''.

On the first day of the trial, the court heard that Mr. Fink insisted if his instructions had been followed the seven investors would have made a profit.

With Mr. Fink in the witness box on the second day of the trial, Mr. Brook Smith said: "You're a clever man, Mr. Fink, but you're also an evasive man.

Would you like to comment on that?'' Mr. Fink was reported to have replied: "You're as entitled to your opinion as I am to mine.'' The case continued yesterday.