Government is working to close a loophole allowing non-Bermudians to acquire land through trusts set up by Bermudians.

Home Affairs Minister Randy Horton told the House on Friday the problem was on the rise.

The trust loophole enables foreigners to purchase housing that would not normally be available to non-Bermudians because of their Annual Rental Value.

He said: ?Government is considering legislation designed to address this very issue. That legislation is expected to be tabled in this House within the next fiscal year.

?In addition, legislation will be brought to this House to strengthen the powers to prosecute persons who have been found to have overstayed their permitted time in Bermuda; to penalise persons who act as hosts for such persons and increase the penalties for employees who work illegally and the employers who employ them.?

Shadow Home Affairs Minister Maxwell Burgess raised the issue of trust abuse during Friday?s Budget debate.

?What scenarios are setting off alarm bells for abuse?? he asked.

Such a scenario might include that of ?Uncle Nobby?, he said. ?Uncle Nobby hasn?t worked a day in his life. Now he?s setting up a trust and is the proud owner of a $6 million home.

?I think that?s worth investigating,? he said, to the laughter of MPs.

Admittedly the situation is not always so cut-and-dry, he added.

?This is a challenge and we have to do something about it ... You may not get it right the first time, but you have to accept that possibility and start somewhere.?

He also questioned the percentage Government would have received from the sale of land such as Tucker?s Point to non-Bermudians.

Such a sale would require a tax, which is ?the only benefit the Bermudian people have seen ... from those projects?.

Government has a ?similar major concern? regarding non-Bermudians purchasing land through trusts, said Mr. Horton. ?We are moving to close that loophole.?

He also said the Immigration Department was also unearthing an increase in the ?fronting? of businesses by Bermudians on behalf of non-Bermudians.

?Much too often, a work permit holder will come to work for an employer and then decide that he or she is able to make a fortune by going into business for himself or herself.

?He or she then recruits a Bermudian to become the majority shareholder or head of the business which then applies for a work permit for the non-Bermudian.

?The Bermudian does not have the expertise to manage the business and/or he or she will not be involved in the business on a day-to-day basis.

?Where a work permit application appears to fit this scenario, it is either refused or the applicant is advised to recruit a Bermudian partner or shareholder who has the required expertise and is prepared to work in the business on a full-time basis.?