financial irregularities at the Bermuda Bakery Ltd. has failed to meet requirements of Police bail.

Canadian-born Earl Fithian, 50, the bakery's sacked company secretary and financial controller, left the Island earlier this month after being questioned about company irregularities that involve some $35,000.

Fraud Squad detectives, after weeks of investigation, said through a Police spokesman yesterday that the Pembroke man at the centre of their enquiries was "in breach of bail conditions'' and to their knowledge had not returned to the Island.

They could only add: "The Police Fraud Squad are continuing with enquiries on behalf of the Bermuda Bakery and once completed a file will be submitted to the Attorney General's Chambers for review.

"Any future action regarding the case will be determined by the Attorney General.'' Officials cited an ongoing Police investigation as reason why there was little more they could say. Fraud Squad detectives will prepare a case, based on the best evidence available to them, as to whether or not their suspect had committed a crime.

Arrested citizens who are released on Police bail, and who fail to answer that bail, face the possibility of being arrested and taken before a court. The court would then determine if the arrested person would be kept in custody, pending a trial.

Police bail is a device used in situations when it is not immediately apparent to the authorities if a person has committed an offence. It is known that Fithian failed to show up at the Hamilton Police Station the week before Christmas (December 19) to honour his Police bail requirements.

The `fugitive' also faces a law suit filed in the Supreme Court December 15 by the company, naming him as a sole defendant (see The Royal Gazette December 16).

That action was taken after Mr. James Pearman, the chairman of the 73-year-old bakery declared that if it was determined Fithian had taken money from, or injured, the company, the bakery, represented by Conyers, Dill & Pearman, would move against his assets.

The bakery's chartered accountants, Butterfield & Steinhoff, discovered that the bakery's commercial tenants in the Belvedere Building may have been over-billed by some $35,000.

Earlier this month, it appeared that the company would have to pay that money back.

But there seemed to be a problem, as well, in the disbursement of share dividends. Fithian, himself, is one of 180-odd shareholders.

The controversy led to the suspension of trading of Bermuda Bakery shares on the Bermuda Stock Exchange December 12, some 11 days after Fithian was arrested while arriving at the airport.

Mr. Pearman said at the time that the company had requested that the Exchange suspend trading of Bakery shares because "irregularities have been identified by our auditors, Butterfield & Steinhoff, in relation to the share register, some issued shares of a small number of shareholders and their dividends.''