A legal petition by an unidentified private creditor to wind up operations at the heavily indebted Hamiltonian Hotel and Island Club has now been launched - plunging the cash-strapped business into even greater financial turmoil.

Meanwhile Attorney General Larry Mussenden declined to comment last night on whether or not Government is proceeding with legal action against the hotel, deferring to the Ministry of Finance. The Royal Gazette was unable to obtain a comment from the Ministry yesterday evening.

However, the Auditor General's 2003 report showed that the Hamiltonian was more than $200,000 in arrears on pension contributions, more than $400,000 in arrears on payroll tax, and more than $200,000 in arrears on land tax.

Bermuda Industrial Union (BIU) president Derrick Burgess said last December that BIU investigations found the hotel had failed to pay pensions and social insurance for more than 20 years.

The Pension Commission became involved in December and a formal review was to be conducted - however, The Royal Gazette was unable to contact Pension Commission CEO Peter Sousa last night for an update.

In December he said that, depending on discussions with the owners and if they wished to cooperate, the Pension Commission may have to proceed with legal action.