The collapsed Bermuda incorporated re-insurance company New Cap Holdings Ltd.

is under investigation by the liquidators.

The accounting firm of Ernst & Young were appointed liquidators of the failed company on March 16 2000 and have already informed the shareholders that a return on their investment is considered remote.

John McKenna of Ernst & Young, Bermuda, and Gareth Hughes of Ernst & Young, London, also advised creditors of the company that they were unlikely to be paid in full.

"We informed them that we have launched an investigation to try and determine why the operation failed,'' Mr. McKenna told The Royal Gazette .

"We are interviewing former directors, executives and advisors of the company in Australia,'' he added, "and estimate that our fact finding will take us into the early summer. After that we have promised to get back to our committee of creditors with our findings.'' The Bermuda incorporated company began in 1996 and was listed on the Australian Stock Exchange. It collapsed a year ago when its underwriting subsidiaries in Bermuda and Australia failed.

According to Mr. McKenna, New Cap Holdings had raised over $200 million in public and private funds since its inception in 1996. The money was obtained mainly in the US and Australia and invested in the operating subsidiaries based in Bermuda and Australia.

But despite the over $200 million investment, the liquidators reported that the Company had debts exceeding $80 million while holding assets of only one million dollars in cash.