ON 8 JUNE 1992, at Birmingham Crown Court, occurred one of the pivotal events in the case of Asil Nadir. Mr Justice Tucker threw out 46 charges of theft, involving pounds 119.5m, brought against the Cypriot tycoon by the Serious Fraud Office (SFO).

Nadir and his defence team were jubilant. 'This is one of the best Monday mornings we have had for a long time,' proclaimed Peter Lakin, Nadir's solicitor. True, Nadir still faced other theft and false accounting charges totalling pounds 30m, but Anthony Scrivener QC, Nadir's counsel, was now confident that when the case finally got before a jury he could clear his client.

The staff of the SFO, who by then had already been investigating the affairs of Nadir's company, Polly Peck, for almost two years, were devastated by the judge's ruling. One of its officers burst into tears.

The importance of that day in Birmingham, when the judge slashed the charge sheet against Nadir, was brought home last week, as a baffling tangle of conspiracies and allegations about the Nadir prosecution found their way into the public domain.

In an atmosphere of the greatest tension, Mr Justice Tucker had given both sides in the case grounds to pursue their causes with exceptional vigour, the defence because it saw the chance of victory and the SFO because it had suffered a grievous humiliation. The judge himself, who would certainly have expected to remain above the impending fray, was to find himself caught in the middle.

THE rumours, accusations and conspiracy theories that led to Michael Mates's resignation, forced the Attorney General to defend in public the integrity of the prosecution service and generally baffled the nation, are at bottom the result of a clash between two creatures of the 1980s: Nadir and the SFO. Both were powerful and both were in trouble.

The elite office that investigates the biggest thieves in Britain was established in 1987 amid fears that large-scale fraudsters were running rings around the system. The SFO was given the unprecedented power to demand that defendants and witnesses answer its questions and hand over documents. The right to silence and the right of a defendant to refuse to help incriminate himself were set aside. But despite its Star Chamber powers and procedure, the SFO ran into difficulty.

Two significant trials involving Guinness defendants collapsed within a week in February 1992. In a third fraud trial last year, charges against advisers involved in a new stock issue for the Blue Arrow employment agency were severely pruned by the judge. When the public spotlight was on it, the SFO seemed unable to win cases.

At the time the SFO was being set up, Polly Peck was a star of the stock market, apparently going to ever headier heights as investors poured their money into what looked like a sure bet. The problem and the strength of Polly Peck was always Nadir, a charismatic man who took a clapped-out clothes company and made it one of the fastest-growing multinationals in the world.

The businessman from the self-styled Turkish Republic of Northern Cyprus ran the outfit like a personal fiefdom and told the shareholders who invested in his company as little as possible. As a result, suspicions dogged the company years before the Inland Revenue or the SFO started looking at his affairs.

On 7 June 1990 Polly Peck's shares reached their zenith at 457p, valuing the company at more than pounds 2bn. Then, on 11 August, Nadir set in train a sequence of events that were to lead to his downfall. He called a board meeting and announced that he wanted to bid for the three-quarters of the company he did not already have, and make it privately owned.

His surprised fellow directors and City advisers hurried to prepare for the bid as investors piled into the shares, expecting that Nadir would be forced to offer them a good price.

Then - inexplicably - five days later he dropped his bid. The shares slumped to 250p. The Stock Exchange issued a stinging public rebuke to Nadir and forwarded its report on the events to the DTI and the SFO.

The SFO already had before it the results of a long-term investigation by the Stock Exchange into apparent insider dealing in Polly Peck shares.

For a decade there had been a curious pattern of big share trades by anonymous investors acting though Swiss banks. The Stock Exchange report on the abandoned bid produced new allegations that insider trading in Polly Peck shares had taken place during that week. It was enough to persuade the SFO to launch a full inquiry into Polly Peck.

A raid on South Audley Management, a fund management company connected to Nadir with offices in Mayfair, London, followed on 19 September. Wild rumours swept the stock market, and Polly Peck's shares tumbled and were suspended. Nadir desperately tried to raise new money.

As he came under further scrutiny, the SFO's interest grew, and it was no longer confined to insider dealing. Nadir's habit of treating Polly Peck as his own private company, and particularly his attitude to British accounting practices, now formed the basis of the SFO inquiry.

It was alleged last week that the information that led to the SFO action came from Michael Allcock, an Inland Revenue investigator, who broke Revenue rules on confidentiality and handed over information about Polly Peck. Allcock, who has been suspended over allegations made in an unconnected case, is at the centre of much of the intrigue around the Nadir affair.

He faxed to the Daily Mail the private letter between Michael Mates and the the Attorney General that led to Mates's resignation. Mates said last week that Allcock could only have got the letter from an SFO officer.

But given the far longer history of wildly shifting and suspicious share movements, these charges are interesting, but insignificant as far as the Polly Peck inquiry is concerned. Nadir would have been investigated anyway, whoever provided the spark.

On 17 December 1990, Nadir, the business success story of the Thatcher years, was arrested by police working with the SFO on his return to Heathrow from a trip to Cyprus.

A statement on behalf of Nadir as long ago as 1991 shows that even then he regarded his arrest and the press coverage of the case as part of a conspiracy. Enemies in Greece, the Greek section of Cyprus, and the West had launched a 'politically-inspired' campaign against Nadir. 'The British and American governments, both of which have significant security interests in the Eastern Mediterranean' had used 'covert pressure'. As well as his desire to fight back against this international conspiracy, Nadir had a more prosaic motive: he did not want to go to jail.

The SFO was equally anxious. It needed a win, but at the pre- trial hearings in Birmingham, with Mr Justice Tucker's decision to throw out many of the charges, it suffered a heavy blow. In this tense atmosphere, it was now clear that the Nadir trial was going to be hard fought. But no one could have predicted just how hard.

BEFORE looking at the development of the case, we should pause to assess one of the more sensational allegations that has been made about the prosecution: that it was part of an international political conspiracy involving British and American intelligence.

This claim has been put forward privately by Mates, who believes that MI6 wanted to destroy the tycoon because his business success in northern Cyprus was blocking an international settlement that would unite the Greek and Cypriot halves of the island. It is very hard to see how such a charge could be true.

Even Nadir, no mean conspiracy theorist himself, does not usually include MI6 in his long list of enemies, which is dominated by Greece and the Greek Cypriots but has a supporting cast that even includes Reuters news agency (for reporting - in his view unnecessarily - an allegation that he had been assassinated).

It is true, of course, that Nadir was the man who did most to kick-start the sleepy economy of north Cyprus, often exploiting assets such as hotels and citrus groves left behind by the Greeks when Turkey invaded and divided the island in 1974.

International sanctions imposed in response to Turkey's military action, and the financial weakness of Turkey itself, had kept the economy stagnant, the only small consolation being that north Cyprus has remained one of the Mediterranean's least spoiled holiday destinations.

But the only covert diplomatic angle to his story that Nadir has made public is an alleged offer by Nelson Ledsky, the former US co- ordinator for Cyprus. Nadir has frequently claimed that Ledsky approached him with a view to deposing Rauf Denktash, the Turkish Cypriot leader and president of the self-declared Turkish Republic of Northern Cyprus.

The script of this plot was that the Cyprus peace talks were going nowhere under the hardline Denktash and that Nadir would be somehow better placed to deal, as one businessman to another, with the then Greek Cypriot leader, George Vassiliou, who was also a millionaire. Nadir has maintained that he rejected Ledsky's approach outright and promptly informed Denktash.

Mates's plot theory is completely different. A departmental note of a meeting between Mates and the former Attorney General, Sir Patrick Mayhew, shows that Mates believed there might be strong political pressure for Nadir to be convicted in order to provide a solution to the problem of northern Cyprus. He further thought the US and British intelligence services might be involved.

Whereas in Nadir's plot scenario the West was allegedly trying to promote him as an agent for the solution of the island's problems, in the Mates version the West is trying to remove him because he is allegedly an obstacle to peace. One thing that both alleged plots have in common is that they assume there is a strong will in the West for a 'solution' to the Cyprus problem. This is scarcely the case.

Given the public emotions aroused by the Cyprus question, we might be forgiven for failing to notice that the situation on the island is actually stable. Greek Cypriots now have one of the world's highest standards of living and Turkish Cypriots feel safe. Western countries may pay lip service to the need for a 'solution' in Cyprus, and there is no shortage of pressure on them from the various regional lobbies, but they are less than active in its pursuit.

Britain, for one, is not exactly putting the squeeze on north Cyprus to negotiate. In fact, this is one of the countries that does most to help northern Cyprus, allowing Turkish Cypriots to visit on their own passports and turning a blind eye to tourist flights to northern Cyprus and the import of north Cypriot fruit.

It is also virtually certain that a strong faction at least of the British intelligence services and military establishment has a tendency to be pro-Turkish. After all, in the 1950s it was ethnic Greek EOKA terrorists, and not Turks, who attacked British troops on Cyprus. Turkey, moreover, has shown a firmer commitment than Greece to the Nato alliance and is a bigger military ally.

If there is a plot, in which Britain is involved, to undermine the Turkish-Cypriot economy and force the statelet to make concessions in talks with the Greek Cypriots, it is a devious one indeed.

LET US return to the prosecution of Nadir. On 6 November 1992, five months after the Birmingham setback, lawyers for the Crown gave the first hint that they were prepared to make an accusation unprecedented in modern legal history. First in the autumn and then again in March they said they wanted Mr Justice Tucker to stand down because they had come across evidence of a conspiracy to pervert the course of justice involving Nadir, the judge, Scrivener and Assistant Commissioner Wyn Jones, then of the Metropolitan Police.

Neither Sir Nicholas Lyell, the Attorney General, nor the police will discuss what happened and the pre-trial hearings in which the issue was discussed were closed. But Mates, in his resignation statement, gave dates and details, while legal sources can fill in most of the gaps.

The accusation was based on a document found in a raid on Nadir's flat, which had been authorised by a search warrant issued to an SFO officer. It dealt with a pounds 3.5m fund in Switzerland. Nadir's name was not mentioned on the document but the name of his wife was. Its contents - which have never been disclosed - prompted suspicion of a conspiracy to pervert the course of justice and, since this was beyond the remit of the SFO, the investigation was passed to the Metropolitan Police.

There is not the slightest suggestion that the judge was actually bribed, or even approached or influenced by Nadir. Indeed, after eight months of murky allegations there has not even been a hint that either Mr Justice Tucker or Scrivener or Wyn Jones behaved in any way improperly - let alone illegally.

The Attorney General has said as much in the Commons and in a letter to Scrivener released last week. But in that letter Sir Nicholas also said: 'There is however still an ongoing police inquiry into the alleged conspiracy and you will understand that the way in which that inquiry is handled must be a matter for the police.'

Not only has no 'credible evidence' - to use Sir Nicholas's words - been found, but the police have not even found the grounds to justify going to see and question the judge, defence counsel or Jones.

Despite this paucity of evidence, a sustained campaign began to remove the judge from the Nadir case. In November, Mates said, the Crown suggested the judge should go because he might be interviewed by the police at some time in the following two months. However in December, again according to Mates, the chief superintendent investigating the alleged attempt at bribery told a further closed hearing he had 'never had evidence which would justify interviewing the judge, nor had the police ever declared their intention of doing so'.

Legal sources added that the defence had vigorously opposed the attempt to get the judge to discharge himself. It was a matter of principle that British judges should not be forced off a case as a result of unsubstantiated, unsourced accusations. Otherwise, the door would be open to conspirators to remove any judge they did not like by the simple expedient of planting false allegations.

The real explosion came in the spring of this year. Mates said in the Commons, and legal sources confirmed, that in March Alun Jones, counsel for the Director of Public Prosecutions, told another closed hearing on the case that the parties to the alleged conspiracy that the police were investigating included the High Court judge and Scrivener, who is a former chairman of the bar.

Again there was no sign of any credible evidence, as the Attorney General admitted last week. Apparently the DPP's office thought the judge could be placed in a difficult position if the defence wanted to reveal details of the alleged conspiracy in open court. The defence might wish to do this in order to show that attempts were being made to undermine Nadir's credibility. The judge would have to decide beforehand whether he could let the jury hear evidence on a conspiracy in which his own name cropped up.

By all accounts, Mr Justice Tucker's tolerance for these convoluted intrigues finally broke and he became genuinely angry for the first time. His reaction has been described as outraged and incredulous.

What to make of all this? Supporters of Nadir claim that the weird series of events constituted a deliberate campaign designed to remove Mr Justice Tucker, because he had thrown out so many charges against Nadir, and also to get rid of Scrivener, who is one of the best defence barristers in the country. Alternatively, they say, the aim was to put pressure on the judge to be tough on Nadir.

It is too much to believe that the DPP, Attorney General and Metropolitan Police - who all investigated the issue - were somehow colluding in some kind of smear. The authorities have to treat any evidence of conspiracy to pervert the course of justice, no matter how slender, with immense seriousness. We simply do not know why the police pursued and continued to pursue the accusation and what evidence they had. We do not know whether Nadir or an enemy of Nadir was trying to sabotage the case.

What can be said is that earlier this year Scrivener decided that the accusations had all gone too far. In a reversal of his previous position, he too asked the divisional court to remove the judge. He put forward the argument that however unfounded the allegations were, the judge might be led to suspect that there had been a conspiracy to bribe him and in those circumstances Nadir could not be guaranteed a fair trial. The court threw the application out.

Now that Nadir has jumped bail, the only real victim of all of this is Mr Justice Tucker, a judge with an impeccable record who has been implicated by the drip, drip, drip of stories in the press and statements in the Commons.

The secrecy that surrounds this case means that a judge with no credible evidence against him cannot refute the allegations in public. Scrivener, in a letter to the Attorney General, said he had 'not lost much sleep over the matter but it was obvious to us all that the judge was understandably concerned about the allegation. Neither of us have been asked a single question . . . I am sure that doubts of this kind must be dispelled quickly if people are to have faith in our judicial system.'

On Friday, Scrivener called for an inquiry into who was trying to get the judge and defence removed from the case. This remains a good question.

(Photograph omitted)