Stephen Schepke, 46, from Sidcup, south-east London, denies the conspiracy and aiding and abetting the killing of David Wilson, 47, who was shot in the head by two professional gunmen.
The Lloyd's investigator, Anthony Cook, told the jury he had been contacted on the telephone by Mr Schepke in October 1991, five months before the killing, and told about a dollars 40m ( pounds 26.5m) plan to defraud both Lloyd's and the buyers of a consignment of Marlboro cigarettes. He had also said he had previously operated in Army Intelligence.
Mr Cook, who was at the time manager of the advisory department of the regulatory directorate within Lloyd's, said it was customary for notes of all telephone conversations in his department to be made from a separate telephone speaker. This had been done during all his discussions with Mr Schepke.
The jury had earlier heard that Mr Wilson was murdered in the garage of his home in Chorley, Lancashire, in March 1992 by two unknown killers after he had been involved in arranging for the shipment of the cigarettes on a vessel he had bought and named after one of his daughters, Lisa Marie. He was shot after it became known he had been questioned by Fraud Squad officers.
The Crown's case, put by Brian Leveson QC, centres on the dealings between Mr Wilson and a man in New York referred to as 'the Colonel' and named as Hector Portillo, who was said to have wanted the Lancashire accountant killed.
The Crown alleges that Mr Schepke conspired with others to have Mr Wilson murdered and that details of his house in Chorley were faxed directly to Mr Portillo shortly before the assassination.
Yesterday, the third day of the trial, Mr Cook told the jury that Mr Schepke had first called him on 9 October 1991.
Mr Schepke told him that he had discovered a dollars 40m 'scam' involving two ships which should have been loaded with containers of Marlboro cigarettes. Mr Cook, reading from his telephone notes, said that Mr Schepke had said that both ships would be operated by 'bent skippers' and would be sunk at sea. He said he had no idea of how the sinking would be done or whether the lives of the crew would be in danger.
He had gone on to explain that a man known only as 'Ian' employed by Lloyd's was also involved in the fraud. He named 'Hector Moretto' as being involved and said that bank accounts had been set up in Zurich and Liechtenstein with fraudulent bonds.
He intimated that all the evidence in the fraud would be destroyed and that would include the paperwork and the 'meat and bones'.
He explained to the jury that there had been a series of telephone calls between them, and during one Mr Schepke had said that he had an intelligence network which 'was better than the Old Bill'. He had also told him that he had previously been in Army Intelligence and that Special Branch would vouch for him.
He had gone on to reveal that David Wilson was 'Hector Moretto's right-hand man'. Mr Schepke had also said that Mr Wilson was on the Home Office 'shit list'. He had advised Mr Schepke to talk to a Fraud Squad officer in the City of London about the plan.
The hearing continues today.