Christian Norgren, a Swedish banker now based in Germany, reached a dollars 3.5m (pounds 2.4m) settlement with the US Securities and Exchange Commission in 1991 without admitting or denying allegations of insider trading. The controversy forced his resignation from Asea Brown Boveri, the construction group where he was a director, and his departure as chairman of the Bank in Liechtenstein. Mr Norgren was also forced to resign as an adviser to Liechtenstein's royal family.
Though supporters of Mr Bock play down the association, it has plainly come as an embarrassment as Mr Bock campaigns to 'normalise' Lonrho.
Mr Bock is still facing fierce resistance from Tiny Rowland and his supporters on the Lonrho board to moves that might make the company more acceptable in the City.
Mr Rowland's dramatic settlement last week of Lonrho's long-running legal battle with the Fayeds over the House of Fraser department stores group is being widely seen as an attempt to pre-empt Mr Bock, who was keen to end the feud.
Mr Norgren has appeared at meetings with Mr Bock in London since the financier became involved in Lonrho early this year. He has been introduced as an 'adviser' to Mr Bock and attended meetings concerning the sale of the Observer newspaper. However, both Mr Bock and Mr Norgren deny that he is a paid adviser to Mr Bock.
Mr Norgren now works as a consultant to West Deutsche Landesbank and is based in Dusseldorf, Germany.
Asked about why he had attended a meeting over the Observer sale, he said: 'I was having lunch with Dieter at the Metropole and he said to me, why don't you come and meet these people with me. He couldn't possibly have introduced me as an adviser.'
He confirmed that he was great friends with Mr Bock and that his wife knew Mr Bock's wife well. 'Now and then he asks me for advice. I have known him for many years and spoken to him many times.'
However, he denied that he had been involved with him on any Lonrho business or that he was being paid as an adviser.
Mr Norgren claimed his association with Mr Bock might have been highlighted as part of a 'dirty tricks campaign' against the German financier.
Mr Norgren said that people could be trying to draw him into the Lonrho saga this weekend as a means of hitting out and weakening Mr Bock's position at the company.
The settlement with the SEC over insider dealing allegations occurred just before Asea Brown Boveri's dollars 1.6bn takeover in 1989 of a US company, Combustion Engineering.
The SEC claimed that Mr Norgren and a company he owned, Financor Anstalt, bought 55,000 shares and 1,700 call option contracts in Combustion Engineering ahead of the bid, resulting in illegal profits of dollars 2.5m.
The SEC also alleged that Mr Norgren violated the securities laws by tipping off a friend about the impending deal, recommending that he buy Combustion Engineering shares, and by making a share purchase agreement with a Californian business associate, Howard Marguleas.
One source suggested that Mr Norgren is helping Mr Bock to place his shares in Advanta plc, an important part of Mr Bock's private business empire.
However, Mr Norgren denied this.
He said that Mr Bock had at one time considered taking Advanta public, and that he had advised him this would not be a good idea.
'I advised him that it would not be a good idea to go public, that he was already engaged in one public company with Lonrho and that it would be in his and his family's interests to keep Advanta private.
'He is engaged fully in Lonrho and that gives him enough of the public company games. He has said that dealing with the situation at Lonrho has been tougher than he thought it would be.'
Mr Norgren said that Mr Bock's main advisers were the merchant bank Morgan Grenfell, and Yurgen Stout, an accountant now being paid a consultancy fee from Lonrho.
Mr Norgren is believed to have worked on the purchase of Thomas Cook, the tour operator, by West Deutsche Landesbank from Midland Bank.
Mr Bock's public relations adviser said that Mr Norgren was not connected with Lonrho, although he had been present at the tail end of last year when Mr Bock first made his move to become involved in Lonrho.
Jeremy Warner, page 2
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