involving the Bank of Bermuda has categorically denied any wrong-doing and claimed that the information in the report is inaccurate and misleading.

Peter Herrington, who was senior member of staff at the Bank of Bermuda in Hamilton before becoming general manager of Swiss American Banking Group where he was fired, contacted the Royal Gazette in a bid to clear his name.

Mr. Herrington, who now lives in Missouri, has written to the authors of the damning report -- which links him closely to $7 million of laundered terrorist and drugs money -- to put his side.

He denied all the accusations put to him in the report, which implies he knew the money was from drugs and terrorism, and said: "You have to look elsewhere for your villains!'' And he said that he thought the money from mobster John Fitzgerald came from casinos and said that no implications of impropriety should be raised against the Bank of Bermuda or any of its staff.

In the report, compiled by the Minority Counsel of the Permanent Subcommittee on Investigations of the United States Senate, Herrington was closely linked to a convicted money launderer Fitzgerald, who allegedly worked for the mob and laundered IRA money through his contacts with Herrington.

And Herrington was accused in the Senate report of using "influence'' on staff at the Bank of Bermuda to get them to accept bundles of cash believed to belong to criminals.

Herrington was named as the disgraced general manager of Swiss American Banking Group and is a central figure in the US Senate report on the laundering of $7 million.

Documents from the probe appear to indicate that 85 percent ($5.95 million) was laundered through Bank of Bermuda, and includes documents from Bermuda Police Special Branch investigations into the case which also points the finger at Herrington.

But Herrington said of the compilers of the senate report: "There can have been no excuse for not calling me to give testimony.'' And he revealed that he had helped the US Authorities in the Fitzgerald case, including attendance at the Grand Jury trial in Boston in 1991 and continuing helping US investigators up to 1998 with their case against Swiss American Bank.

He said: "The information from the Bermuda Special Branch was inaccurate and misleading in many material respects -- not least the implication that I was aware of the source of funds as profits from drugs and arms dealings -- which I deny categorically. Fitzgerald claimed the money was the result of casino operations.

"All concerned in these investigations seem to rely on the benefit of hindsight to justify unwarranted attacks on my integrity -- you have to look elsewhere for your villains!'' Herrington worked at the Bank of Bermuda in Hamilton for several years in senior positions in the early 1980s before moving to Cayman to take up the top job with the Swiss American Banking Group.

Herrington is closely linked with the central character in part of the Senate investigation, John Fitzgerald, who was convicted of racketeering conspiracy and money laundering in the United States in connection with the $7 million of mob money.

The Minority Staff of the US Senate Permanent Subcommittee on Investigations report on Correspondent Banking: A Gateway to Money-Laundering revealed this week that: "In October 1995 Herrington used Swiss American's relationship with the Bank of Bermuda to influence staff there to accept the cash deposit.'' The report also states: "The general manager of the Swiss American Banking Group was at the time Peter Herrington who assisted Fitzgerald with the formation of all IBCs (a type of share-owned corporation) and management of the accounts at SAB (Swiss American Bank) and SANB (Swiss American National Bank). The formation of the accounts was handled by Antigua International Trust. Herrington served as director of all the IBCs and Guardian Bank and performed transactions in the SAB and SANB accounts.'' Swiss American Banking Group is owned by financier Bruce Rappaport, a former Bermuda resident who is believed to have, during the 1980s, held millions of dollars in Bank of Bermuda accounts.

Herrington was suspended and then sacked from his job in Swiss American in 1987 when he refused to tell Rappaport who ran the accounts.

The report said: "Between the time of Herrington's suspension and his termination, he notified Fitzgerald of Rappaport's concerns.'' Banker bids to clear name According to a Bermuda Police Special Branch report extract in the published Senate report, the sum of $450,000 in cash was believed to have been taken out a Bank of Butterfield safety deposit box, and taken in cash to Bank of Bermuda, where it was deposited with Herrington using the "influence'' of the Antiguan bank.

The report goes on to state: "When the funds were transferred to the account at Swiss American, they were `held' until Herrington made the book entries.'' The extracts are from the section of the report called The Fitzgerald Case -- Drugs and Terrorist Money which repeatedly puts Herrington and Swiss American Banking Group at the centre of the money-laundering scandal.

While living in Bermuda Herrington is believed to have worked under Barry Shailer, now chief compliance officer, and the then-chief executive officer Donald Lines, who helped set up Lines Overseas Management.

Herrington, who for some time held the position of assistant manager, corporate banking, legal and secretary was then given the additional responsibility in mid-1983 for the Bank of Bermuda's corporate loans and letters of credit facilities under the direction of Barry Shailer, who was at the time manager of corporate banking.

Herrington added: "At no time during my tenure in Bermuda was I aware of the existence of Fitzgerald or the other named persons. As regards my dealings in Antigua, exhaustive internal and external banking enquiries and audits, lawsuits and judicial enquiries have never resulted in any action or pursuit of me in any jurisdiction, for the simple reason that I committed no wrong-doing.

"Please note ... that the US Government asserted the funds in question had been derived from drug-dealing -- nothing to do with the IRA.

"It seems that the Bermuda Special Branch took it upon themselves to form judgments without proper investigation, and without seeking my testimony. I am delighted to have this opportunity to set the record straight, particularly as no implications of impropriety should be raised against the Bank of Bermuda or any of its staff.

"If there is a "disgraced banker'' in the plot he will not be found to have worked in Bermuda or Antigua!'' Herrington also forwarded a letter to the US Department of Justice Criminal Division in Washington dated February 17, 1998 in which he said: "At no time during my dealings with Fitzgerald was I made aware of the identities of any partners he may have had, and I had no knowledge of the source of funds, illegal or otherwise.'' He added: "At the time, no money-laundering laws such as we enjoy today existed, and it was not unusual for sizable sums of money to be transferred from one country's banking system to another. Only if large sums of cash were to be presented for credit of an account, would any alarm bells ring.'' In this letter he stated that the assertion by the US Department of Justice Criminal Division that bank accounts were set up by Fitzgerald and Herrington "to disguise and conceal the ownership, location, source and nature of these monies'' as "repugnant''.

And he defended moving monies from one account to another as standard practice and not unusual.

He said: "As all these matters were given a full airing at the time of the Grand Jury I attended in Boston, and as I then I offered my full co-operation in recovery of the funds to the US Government, I am surprised and disappointed to find myself the target of accusation of improper behaviour. It was because I was not prepared to indulge in any dishonesty, either for the owner of the Antigua Bank Group, or for Fitzgerald, that the US Government has the opportunity to recover these funds.''