The SFC said the information in Bankhall's brochures was misleading in two ways.

First, while Bankhall illustrates extraordinary performance statistics dating back to 1987, neither Micropal in Hong Kong, Micropal in London, nor the SFC could find any trace of Bankhall funds dating back past December 1989.

Ms Glass said the SFC could not find any Bankhall funds dating back past 1989, despite the fact that Bankhall uses 1987 and 1988 performance statistics. A second concern relates to the actual accuracy of the performance statistics.

For example, inquiring investors looking into any one of Bankhall's four authorised funds, receive brochures with figures showing a 24.40 per cent return for the year 1992. However, according to Micropal (supposedly Bankhall's only source of statistics) the average return on their authorised funds for the US dollar investor was 6.41 per cent in 1992.

Moreover, Bankhall did not indicate that their 24.40 per cent statistic was illustrating the return for the best performing fund, and that it was calculated in sterling. The sterling return of the fund would have been boosted by the decline of sterling in autumn 1992.

But when that same fund's performance is considered under the form of US dollars - which most Hong Kong investors use - the 1992 return works out to be 1.25 per cent, according to Micropal.

To complicate matters, sources in the industry said that Bankhall had relied on a historic pricing system up until 1992, whereby they could buy and sell investment products at the previous day's prices.

To give an example of how this pricing system works, if the Hang Seng Index shot up five per cent, Bankhall could buy a fund at yesterday's value, knowing it had a guaranteed gain from today's market movement. Equally, if the market crashed, and it knew it would be losing because of today's market movement, it could sell at yesterday's market price avoiding the loss.

While the historic pricing system is not illegal, many companies do not let fund managers exercise the practise because it is unfair to existing long-term unit holders.

A local broker who had considered selling the Bankhall products, said: ''They were certainly using the system in 1991, and when I was conversing with them last year, they were at least using it for one of their funds.'' Nick Barclay, who is the director of sales and the only Bankhall representative in the territory, said Bankhall had stopped using the system in 1988.

''We had to stop using the historic pricing system immediately after it was restricted, that was back in 1989 I think,'' Mr Barclay said.

However, others, who are currently working closely with Bankhall, agree the whole pricing system has been a ''grey issue''.

''We've also heard the rumours about Bankhall using the window pricing system, they were saying that Bankhall was using it up until last October or November, which we don't think is true. But we have no proof either way,'' said Diccon Martin, consultant for Towry Law, which advises some clients to buy Bankhall products.

Clerical Medical International (CMI), an insurance company which Bankhall uses for two of its Hongkong authorised funds, shed a little light on the subject.

Although the CMI representatives in Hong Kong said ''they preferred not commenting on that sensitive subject'', Nigel Gardner, deputy chief executive for CMI's headquarters in Isle of the Man, said: ''I do believe other insurance companies let Bankhall continue using the window pricing system, but certainly not us. If sources have said it was CMI that was doing it, they must be confusing us with the other insurance companies.'' Nonetheless, the sources which confirmed that Bankhall used the window system until recently, prefer not to be mentioned.

Looking at Micropal's statistics, investors might be able to make their own decision about whether or not Bankhall discontinued the window pricing system in autumn of last year.

''Well, frankly, Bankhall's performance did really take a dive around October or November. They were expecting to get a special dealing system after, but it fell through so performance has been pretty miserable since then,'' said Mr Martin.

More confusion sets in when investors request 1993 statistics for the four funds.

When asked if he could provide the 1993 up-to-date statistics for the four authorised funds, Mr Barclay said: ''I don't have any 1993 statistics, I have to wait for Micropal to send them to me, we use Micropal for our statistics.'' But according to Carl Meerveld, Micropal's director in Hong Kong, it is unlikely that Bankhall doesn't have the current figures, as they have access to the weekly up-dated Micropal computer system.

''Micropal tracks the performance of over 20,000 funds world-wide, the standard Micropal service is updated every week and includes all the Bankhall funds,'' said Mr Meerveld.

According to the prospectus, investors are charged a one per cent annual fee by CMI Insurance Company, an additional 1.5 per cent annual fee by Bankhall and an up to eight per cent front-in charge.

Bankhall does not mention, however, the charges incurred when Bankhall actually invests in other company's funds.

Labelled as exceptionally high management charges, investors might want to consider that Bankhall sits in cash about 75 per cent of the time.