1992 proved to be a difficult year for Bermuda's businessmen as the recession contined to bite. A year marked by an Island-wide strike in July, "vanishing acts'' by a number of weak tourism season among other events, it surprisingly ended with more optimism than it began with as visitor arrivals picked up and the Bermuda Exchange surged to four consecutive record highs. JANUARY The New Year is traditionally a time for optimism and fresh starts, but Bermuda's businessmen found it hard to see anything but the dark side as they knuckled down to a year of toil.

But, for some, the time for hard work had long gone and it was time to pull up their stumps and set them in new ground.

Fast food outlet Burger Island became the first casualty of 1992, closing down with debts of more than $1.1 million -- $581,229 of which came in the way of unsecured credit to suppliers.

The largest creditor was the Bank of Butterfield, but, as is so often the case with banks, its outstanding loan of $549,000 was secured, in this case by the premises which houses the Robin Hood pub and restaurant.

Someone else who did not have much to shout about was businessman Mr. Michael Haegele, who, it was revealed in January, had done a vanishing act from Bermuda.

Mr. Michael Haegele, who is a director of Scandal Nightclub, which had financial problems of its own during 1992, was reported to have left behind huge debts.

In a move which was to be followed later in the year by restaurateurs Bill and Wendy Meade, Mr. Haegele decided to flee the Island rather than face up to his responsibilities.

As action was taken against him at Supreme Court, reliable sources said part of his financial problems were due to gambling debts he ran up in Atlantic City.

Debt collecting `heavies' from the New Jersey gambling resort had allegedly been sent to Bermuda to find him.

An indication of the total lack of confidence in Bermuda's retail industry was all too evident at an auction to sell the Sportsman's Shop, in Hamilton. The business failed to attract a single bid! Depending on who you believed, Bermuda's hotels were either basking in profits or losing money hand over fist.

The Bermuda Industrial Union believed the first scenario to be true. But Bermuda Hotel Association announced that the Island's eight largest hotels, which account for over 75 percent of the industry's beds, had lost several million dollars during 1991. FEBRUARY Oh what a shocker! Out of the blue, it was announced that the Canadian military base at Daniel's Head, Sandy's, was to close by March, 1994.

Canadians may have a reputation for being tight with their money, but nobody was making a joke out of the millions of dollars of foreign currency per year that will be lost to the local economy. Seventy jobs are also going. Like the Canadians, the once-mighty Purvis group also signalled that it was throwing in the towel.

Following a record $2.8 million loss for fiscal 1991, Purvis took the business community by surprise when it announced it was selling its core operation -- wholesaler Purvis Distributors.

The buyer was one of Bermuda's most aggressive businessmen, Mr. Ward Young, of BGA.

In one fell swoop, Purvis slashed its workforce in half. Over the following months, the company was to sell off virtually its entire empire, leaving it with a small securities company and property interests.

Maybe the company wanted the cash to take advantage of what would turn out to be one of the wisest, and most profitable, predictions of the year -- to buy local stocks.

Bermuda Exchange chairman Mr. Bill Dolan told investors that it was a great time to invest in local companies listed on the Exchange, particularly with falling interest rates.

"I think you will see the smart money coming out and looking for opportunities to invest if interest rates fall,'' he said.

How sound his advice turned out to be. By the end of the year, the Exchange Index had risen to a record high, climbing by more than 230 points and soaring above the 900 mark for the first time.

In the Budget speech of Finance Minister the Hon. David Saul, he gave a commitment in writing that Bermuda's out-of-date exchange controls would soon be lifted.

Ten months later, however, this "commitment'' was still all there was of the plan. MARCH Oh what another, even bigger, much bigger, shocker! The US Navy announced it was reducing its military staff in Bermuda by 60 percent, from 650 to 300 people.

While Bermuda's economy could quite comfortably absorb the loss of the Canadian dollars, the same is not true of the impact of large cutbacks at the US Naval Air Station.

When dependents and civilians are taken into account, about 1,200 of the 3,000 people involved with the base will go.

Base commander Capt. Jim Arnold gave assurances that a total shutdown was not about to happen.

But, later in the year, an ABC television documentary alleged the Base no longer served a military purpose and was a waste of US taxpayer's money. In the aftermath, the Base's future did not look too bright.

Bermuda Commercial Bank announced it was moving away from retail banking, with 40 job losses, due to heavy losses.

BCB managing director Mr. Richard Francis said: "The Commercial Bank has only four percent of the domestic market for retail banking, yet it takes up 80 percent of our costs.'' Mr. Francis also revealed that Barclays Bank was involved in negotiations with "a major US investment company'' to sell its 32 percent stake in BCB. Mr.

Francis would not name the potential buyer, but he added: "They are a household name on a global scale with substantial overseas interests.'' APRIL It was a busy month on the non-business front -- the Conservative Party won the UK general election, Lord Waddington was appointed Governor of Bermuda, College Weeks attracted just 1,800 students, German tourist Miss Antja Herkommer was murdered at Dockyard and there was a $10,000 security van hold up during which a shot was fired.

Lawyer Mr. Julian Hall suggested that casino gambling should be considered to spruce up Bermuda's dull image.

"If Bermuda is regarded by the modern tourist as a bore we must make it more exciting,'' he said.

His words were borne out by College Weeks student Miss Jenna Curry, who said: "The place is dead. there's no-one my age here. I won't be coming back.'' Failed businessman Mr. Mark Hardy issued a civil lawsuit against accountants Mr. Peter Mitchell, Mr. David Lines and Mr. Kirkland Cooper, the liquidators of his insurance concerns, for allegedly conspiring to injure his business interests. MAY Investment firm First Bermuda Securities began the first over-the-counter trading of local stocks.

The Royal Gazette revealed that both the FBI and the US Securities and Exchange Commission were investigating alleged money laundering into Bermuda from Los Angeles-based Financial News Network (FNN).

FNN holds shares in Bermuda-based Intex, a bankrupt computer software firm previously run by US businessman Dr. Earl Brian.

Dr. Brian's name cropped up during a US Government investigation into the theft of an enormously expensive and advanced piece of computer software and its illegal use overseas.

While all this was going on, Intex went bust with debts of around $1.6 million.

A Royal Gazette investigation revealed that former Bank of Bermuda loans officer Mr. Arnold Todd allegedly authorised a $275,000 bank loan to local tour boat company Bermuda Excursions while secretly holding a 20 percent stake in the firm.

Mr. Todd denied it, but he was contradicted by the two men who ran the company, Mr. Robert Thomson and Mr. Llewellyn Peniston, in whose name the shares were allegedly held.

Oil tycoon Mr. John Deuss played a part in the world's largest oil deal between Chevron and Kazakhstan, which is expected to generate $230 billion of oil over the next 40 years. JUNE June will go down as the month in which the seeds were sowed for the widespread strike at the beginning of July. It was also the month when it rained virtually every day.

Many tourists cut short their holiday and decided to fly home or go somewhere drier or more hospitable, according to local hoteliers.

Even this proved hazardous, though. Several tourists were dropped off hundreds of yards from the airport as some taxi drivers refused to cross picket lines.

They were left to walk the rest of the way, lugging their baggage in the pouring. And people wonder why there's a drop in tourism.

By the last day of the month, the Bermuda Industrial Union had called out bus drivers, ferry workers, taxi drivers, garbage collectors, garage workers, dockers and airport staff. The next day, they called out everyone. JULY Purvis bid farewell to Mr. Don Straw, its president and CEO, who left the firm seven months before the end of his contract and went back to Canada.

Mr. Straw gained notoriety for sacking staff by the dozen and masterminding the dismantling of the Purvis empire.

Purvis chairman Sir John Sharpe denied Mr. Straw had been brought in to do a hatchet job. "He was brought in generally to increase sales and make it a more effective operation,'' he said. "But the little thing we call the recession came in and virtually precluded any substantial increase in sales.'' Bermuda resident KC Irving, 93, who was to die later in the year, was named by Forbes magazine as the 18th richest person in the world, with a fortune estimated at $5 billion.

The long-running docks dispute was partly blamed for a $1.8 million loss suffered by Bermuda Container Lines during fiscal 1991.

And the airline downturn was largely responsible for Bermuda Aviation Services' loss of $122,000 for fiscal 1992, according to management.

Wholesalers Vallis & Co. and J.S. Vallis denied rumours that they were negotiating to merge.

Vallis president Mr. Francis Vallis was adamant that no deal was in the offing. On July 15, he said: "There's no truth in it. We've had no meetings and there's no information I can tell you about.'' He was simply not telling the truth. Nine days later the firms announced they were going to merge. AUGUST The local operation of Trinidad-based United Security Life Insurance Company, which had 2,000 policyholders in Bermuda, closes down.

Judicial Manager Mr. Brian Fortier accused Bermuda's authorities of "total amateurism'' over their handling of the affair.

They had stepped in too late and, when they did so, tried to wind-up the whole operation, which he said was the worst possible thing to do with a life insurance company.

The most important thing was that policyholders were left with some form of coverage, even if it was reduced, said Mr. Fortier. Everything should be done to keep the company afloat, he said.

Mr. Fortier paid a dear price for his outspoken comments, he was later sacked by his firm of actuaries, Acumen Ltd.

On assets of $3.4 billion, the Bank of Butterfield reported a profit of $26.9 million -- an increase of 27.6 percent over previous year.

Hurricane Andrew hammered the Bahamas, Florida and Louisiana, affecting Bermuda-based insurance companies such as Paumanock Insurance, Stockholm Re., Brittany Insurance and NRG Victory. SEPTEMBER Blue Oyster restaurant owners Bill and Wendy Meade fled Bermuda leaving behind debts estimated at around $250,000. Creditors should have been warned one week before when the Meades cheekily held a house sale.

A 30 percent reduction in air fares between North America and Bermuda may tempted the Meades to get out while it was still cheap.

By the end of the year, the couple were still on the run and nobody knew where they were. Local lawyers reckoned they could face criminal charges carrying up to two years in prison if they ever set foot in Bermuda again.

In the biggest business news story of the year, it was revealed that the York-Hannover property group, which owns the St. George's Club timeshare complex, was in desperate financial trouble.

A Bermuda resident applied to have the group's Swiss-based parent company wound up over an unpaid debt of 750,000 Canadian dollars relating to a loan he said he gave to help get the 65 unit Bermuda complex off the ground.

Bermuda police began investigating the York-Hannover group's activities following an allegation of fraud.

Bermuda Cablevision's AGM was one of the most chaotic ever held by any local company.

Many local shareholders rebelled against their own board over the legality of the company's ownership structure, which sends 60 percent of profits overseas every year.

The Bank of Bermuda reported a modest four percent increase in profits to $28.4 million.

A survey by the influential Banker magazine placed the Bank of Bermuda second to the Bank of Butterfield in areas of soundness, real profits growth, performance and return on assets. The Bank of Bermuda came out ahead only in terms of asset size.

The Banker said ranked the Bank of Bermuda as the world's 684th largest bank, with Butterfield appearing in a respectable 813th place. OCTOBER The St.

George's Club was seized by its principal creditor, Central Guaranty Trust Company (CGTC), of Canada, over an unpaid debt of $9 million. The Club has a total debt of $79 million -- $70 million of which is internal with the York-Hannover group.

Worried about the security of loans to the St. George's Club, Bermuda Commercial Bank seized $380,000 from York-Hannover accounts held at the bank.

CGTC promised to sue the bank for allegedly taking the money illegally. The Trust Company also announced that a "well-known North American hotelier'' had offered to buy the St. George's Club, although it would not give a name.

On a lighter note, two timeshare salesmen working at the Hamiltonian Island Club timeshare project fled Bermuda when exposed by The Royal Gazette . One of them, who was confronted by a journalist outside Prego's Restaurant, did not even stop to pack in his haste to get to the airport. NOVEMBER Ram's Head pub owner Miss Cathy Ferreira announced a change of name and image for her business. Two weeks later it closed down under a mountain of debts.

Property catastrophe reinsurer Mid Ocean Reinsurance Company, which is capitalised at more than $350 million, began operations.

"This unquestionably will be treated by the business world and, particularly, the insurance industry, as an event of great importance,'' said president Mr.

Ian Heap. He likened Mid Ocean's formation to that of EXEL and ACE in the 1980s.

Property casualty insurer Paumanock Insurance stopped taking on new business and was put up for sale. The company took a hit on Hurricane Andrew, with its gross loss before reinsurance thought to be $30 million and its net loss estimated at between $10 and $20 million.

Bermuda Cablevision rebels suffered a defeat at a special general meeting of stockholders, but shareholder Mr. Jeff Conyers said he would pay for court action himself and sued the company and its directors over the legality of the firm's ownership structure.

Mr. David Thirkill and Mr. Douglas Pullen win a fight to have set aside an action for $19.7 million against them brought by the liquidators of Focus Insurance, of which they were directors.

In doing so, the Court of Appeal said a director could not be held responsible for the actions of a fellow director who may be up to no good if they had no reason to suspect him.

An application to set aside the action against former fellow director Mark Hardy, who ran Focus Insurance, was refused.

Two Bermudian women, Mrs. Kathy D'Estelle Roe and Mrs. Lesley Hoskins, lose a small fortune over their involvement with the Blue Moon Restaurant, in Hamilton.

They bought the restaurant for $265,000 in 1988 from private detective Mr.

Bill Black, but sold the loss-making business four years later for just $60,000 to Mrs. Betty Compagnon, a previous owner who had sold it to Mr. Black in 1986 for a sum thought to be in the region of $115,000.

After all the transactions, Mr. Black had profited by $150,000, Mrs. Compagnon had made a profit of $55,000 and still owned the business, but Mrs. D'Estelle Roe and Mrs. Hoskins had lost $205,000 between them. DECEMBER Bermuda-based captive Dual Plus Insurance Company was put into liquidation by a Los Angeles Superior Court.

The company had previously been seized by California Insurance Commissioner Mr. John Garamendi for allegedly operating in California without a licence.

When he took his action, Mr. Garamendi had said: "I'm giving Dual Plus a big minus for putting policyholders and creditors at risk for simultaneously trying to reap the benefits of being based in the unregulated waters of Bermuda, while at the same time illegally conducting business in the state without qualifying for a California licence.'' His comments about Bermuda being "unregulated waters'' did not go down well locally.

The Bermuda Exchange Index recorded three consecutive record highs, led by Bank of Butterfield stock which almost doubled over the year.

Mr. Julian Hall countersued the Bank of Butterfield for $510,000, almost five times the amount he owes them.

And, finally, an investigation by The Royal Gazette revealed that the Phoenix Stores had ripped off readers of a British newspaper magazine for four years by overcharging them.

Phoenix Stores president Mr. Reid Young put it down to an "honest mistake''.

Others in the community felt it had been a deliberate attempt to immorally boost profits.