A front page story in a leading British newspaper today reported "a Bermuda link'' in the Barings bank collapse.

"Allegations that the trader at the heart of the Barings bank collapse had links with an unorthodox Bermuda-based investment firm, Ross Capital, are at the heart of an internal investigation into how the city's oldest investment house was brought to its knees with debts of more than (pounds) 750 million,'' The Guardian newspaper reported under the banner headline, "Barings' rogue trader alleged to have Bermuda link.'' Mr. Wolfgang Flottl, who has a home in Tuckers Town, is the owner of Ross Capital Markets Ltd. on Bermudiana Road and International Asset Management, at the same location.

The Guardian reported Barings has focussed its inquiry on "a web of suspect share deals which stretch right across the Pacific rim to examine the relationship between its missing trader, 28-year-old Nick Leeson, and Ross Capital.'' The article said the news emerged as it became clear Barings would have to pay millions to clear "phantom accounts'' set up by Mr. Leeson in order to settle its liabilities.

"Ross Capital, which is part of a highly-secretive web of Bermuda-registered companies controlled by the Austrian-born financier Wolfgang Flottl, yesterday (Tuesday) denied it had links with Mr. Leeson, who is on the run in the Far East,'' the article said.

Guardian reporters Patrick Donovan and Sarah Whitebloom added: "There is no suggestion that Ross Capital was knowingly involved in irregular share deals.

However, investigators involved in the internal inquiry believe the company could have been unwittingly involved in irregular trades by Mr. Leeson.

"Based in the off-shore tax haven's capital, Hamilton, Ross Capital is Mr.

Flottl's key investment vehicle. Through it, he invests funds on markets from Tokyo to New York.'' The article said "rogue'' share contracts were based on the Tokyo stock market.

The article goes on to say at least one other internationally known investment house is thought to be involved in suspect share deals carried out by Mr.

Leeson. And it said there was now speculation bank chairman Mr. Peter Baring was ready to announce the bank will split into three divisions and be sold to separate overseas buyers.

Mr. Leeson is thought to have fled to Malaysia, possibly on his yacht.

Mr. Flottl is in partnership with Premier the Hon. Sir John Swan to build the proposed Seon Place luxury office block on Front Street.

He was in the news last summer concerning his companies' involvement in investment transactions with the Austrian Bank fur Arbeit und Wirtschaft (Bawag), of which his father, Mr. Walter Flottl, is chairman.

The relationship, which lasted six years and involved loans to Flottl's companies from his father's bank, was under investigation by Austrian bank regulators.

MISSING TRADER Mr. Nick Leeson. (File photo)