Imro works on Morgan safety net

Imro, the fund management regulator, said last night that it was working with Morgan Grenfell Asset Managment to set up an enlarged safety net for its three troubled funds, which have already been given pounds 180m in cash by Deutsche Bank, the parent group.

It also emerged that Deutsche Bank had been ordered by the German banking supervision authority to report to it every day on developments in the Morgan Grenfell situation.

Another pounds 24m was withdrawn from the Morgan funds yesterday, considerably less than the total of pounds 232m redeemed by worried investors on the previous three working days.

But with Deutsche's contribution, the funds only had a pounds 300m cash pile when they resumed trading last Thursday, and less than pounds 50m of this remains,which is thought to be too small a cushion even if the level of redemptions continues to slow at its current rate.

"Imro is working with Morgan Grenfell to ensure that appropriate measures are in place," an Imro spokesman said.

In the meantime, investigators are looking for evidence that Peter Young, the fund manager at the centre of crisis, owned stakes in the maze of Luxembourg shell companies he set up. They are trying to establish whether he made any personal gain.

To date, the Serious Fraud Office has not been passed any information which has led director George Staple to open a formal investigation into the affair.

Russ Oil and Technology, which is Luxembourg-registered, is at the centre of the inquiries. Its discovery sent regulators on the trail of Mr Young and his dealings last month. Last week Morgan Grenfell froze Mr Young's assets and those of Russ Oil.

Set up on 22 December 1995, Russ Oil has the same structure as the other holding companies set up by Mr Young, apparently to hide the extent of his stakes in unlisted Scandinavian companies.

It emerged yesterday that the name of one of the Luxembourg holding companies - Horten Technology Holding SA - may have been based on name of the home town of Sensonor, a high technology firm based in Horten, Norway.

Sensonor's flotation was handled by Carnegie in 1994. The annual report of the Morgan Grenfell European Capital Growth Fund shows that the fund had 3.35 per cent of its assets in the electronic components company's shares as at 31 January, 1996.