Creditors of two Bermuda companies set up by a businessman indicted in an international fraud inquiry are meeting today to discuss putting them into liquidation.

Canadian broker Mark Valentine is facing trial in Florida on security fraud charges after being arrested in the Bermuda Short sting operation run by the FBI and Royal Canadian Mounted Police.

Registrar of Companies Stephen Lowe, as official receiver, is taking steps to put two of Valentine's companies VC Advantage (Bermuda) Fund Limited and Advantage (Bermuda) Fund Limited into liquidation.

He is taking the action because there is no one running the companies here now.

The move will liquidate the companies' assets to try to pay off debts owed to mainly Canadian institutional investors which sank money into Valentine's schemes.

Some local service providers are also among the creditors.

Valentine, 32, specialised in investing heavily in start-up schemes.

He was arrested in Germany last year while 19 others were also taken into custody following two year undercover operation.

Valentine, of Toronto, was extradited to Florida where he faces a US Grand Jury trial on charges of paying kickbacks on stock sales to a fictitious fund company set up by the authorities.

Another businessman arrested in the operation, Paul Lemmon, who ran the Voyager Group in Bermuda, was jailed for 21 months for his part in the sting after pleading guilty.

Lemmon was described in reports as the "trusted offshore front of Valentine" who bribed undercover officers to buy millions of dollars of worthless shares.

Mr. Lowe told The Royal Gazette yesterday: "We petitioned the company because there is no mind or management. It was in contravention of the Companies Act and we had not choice."

The liquidation meetings will be held today in the Hamilton offices of accountants PricewaterhouseCoopers.

D. Geoffrey Hunter of PricewaterhouseCoopers said yesterday: "We are acting for the official receiver to secure the liquidation of VC Advantage (Bermuda) Fund Limited and the Advantage (Bermuda) Fund Limited.

"The reason the companies are in liquidation appear to be insolvent and because there isn't mind and management of the ongoing operations of the company."

Valentine, who denies security fraud conspiracy and securities fraud, was scheduled to stand trial earlier this year in Florida but his current location is not known.

It was reported that Lemmon plans to testify against Valentine.