Wolfgang Flottl as "a potential liability'', the latest issue of International Business Week has reported.

Dr. Flottl has drawn public attention on the last ten days following reports of the close financial relationship between his companies and the Austrian bank run by his father which has drawn attention from Austrian bank authorities.

The two-page article, headlined "Wolfgang Flottl's Network of Shadows: His rumoured losses send ripples from Vienna to Wall Street'', says some Wall Street traders believe Dr. Flottl's Bermuda-based companies were behind large sales of "Japanese futures, German and French bonds and other sovereign debt'' in mid-April.

It attributes Wall Street sources as saying that this follows on the heels of profits of $575 million in 1992 and $750 million to $1 billion last year.

The story quotes an unnamed hedge fund trader as saying: "There is a large liquidation going on, and the (Wall) Street thinks it's him.'' Business Week continues, "Some Street firms with which he has traded now are reexamining their exposure to Flottl and whether to continue trading with him.'' A vote of confidence in Dr. Flottl, however came from Bear, Stearns and Company, chief executive, Alan C. Greenberg, who is quoted as having said, "We would like to have other clients like him.'' And the magazine noted that other Wall Street friends included Morgan Stanley and Company and Nomura Securities International.

Dr. Flottl's major investment arm is Bermuda-based Ross Capital Markets Ltd. A secretary there, who yesterday wished to remain anonymous, said Dr. Flottl was travelling and unavailable for comment.

The company is described by his representatives as being highly liquid and very well capitalised.

And the article describes Dr. Flottl as "an aggressive and extremely secretive investor'' and says that he has apparently been making hugely successful bets on market cycles.

It said he is described by his own people as a highly skilled investor with an almost uncanny ability to play market cycles, scoring in the late 1980s repeatedly in risk-arbitrage bets on take over deals.

The interest in Dr. Flottl stems from a series of articles in the Austrian press about Dr. Flottl's father, Mr. Walter Flottl, the chairman of the ultra- conservative Vienna-based Bank for Labor and Business (BAWAG).

He has been facing enquiries from Austrian regulators over the use of bank funds for investments by Dr. Flottl. Father and son have denied the investments were risky but Dr. Flottl has said they will be liquidated by the end of this week due to "scurrilous attacks'' in the press.

One intriguing part of the story states that Salomon Brothers two years ago hired investigators, Kroll Associates to probe claims that the private detectives later dismissed, that Dr. Flottl was using "shadowy Middle Eastern figures and that drug money and money laundering was involved''.

The same investigators were asked by Dr. Flottl's lawyer, well-known US litigator Mr. Arthur Liman, to find out where the rumours came from, and eventually an accusing finger was pointed at an Austrian and an Israeli who had engaged in a failed attempt to blackmail Dr. Flottl. The two are under federal investigation in the US.

Kroll chairman, Mr. Jules Kroll, is quoted: "It was beyond weird. Our conclusion was that these dirtballs had tried to shake him (Flottl) down. He refused. The source of the funds was an arrangement with his father's bank; nothing more or less mysterious than that.'' Dr. Flottl is married to Barbara Anne Eisenhower, the grand daughter of former US President Dwight Eisenhower.

He owns Tucker's Town estate Castle Point and is a partner with Premier the Hon. Sir John Swan in Seon Place Ltd., which recently received approval to construct a Front Street office building which will house Ross Capital Markets and Dr. Flottl's other companies.