His movements are a bit slower than a few years ago and his gait a little unsteady, but when he latches onto the scams that roil financial markets, his thoughts seem to race ahead of his words.

Paul Erdman, father of the financial thriller, is at it again. Ensconced like a seer at a hilltop ranch outside this small Northern California town, the 64-year-old writer and lecturer is about to launch his latest tale of financial intrigue.

"The Set-Up" it tells of the ultimate insider trading swindle. An ex- Federal Reserve chairman uses confidential information on interest rates to amass hundreds of millions in illicit trading profits.

"Who could possibly have better cover than a former Fed chairman?" Mr. Erdman asked. "His basic dilemma is where to do it and how to do it."

"The Set-Up" will be published in April. Two years in the making, it is the latest in a long line of financial thrillers that began in 1973. Like Mr. Erdman's earlier works, it takes place several years in the future and contains simple explanations of the intricacies of financial instruments. For the professionally inclined, his works also contain tables that track the course of the main protagonists' market maneuvers.

Although it would be easy to dismiss the Canadian-born author and ex- banker as just another paperback hack, his works have been eerily prophetic.

As recently as three years ago, "Zero Coupon" warned that the enormous profits from derivatives would soon attract rogue traders.

Since then, a $1.1 billion loss from illicit trading by an employee in Singapore triggered the collapse of London-based Barings PLC, while Japan's Sumitomo Corp. more recently weathered a $1.8 billion loss racked up by its head metals trader.

Another of Mr. Erdman's works, "The Swiss Account," delved into some of banking's more unscrupulous practices and has since triggered inquiries into what are believed to be the billions of dollars stashed away in Switzerland by Nazi war criminals.

"Swiss banks recapitalized themselves several times over with the funds deposited during the war," Mr. Erdman estimated. Banking ethics, he added, have barely improved since then.

"A whole new class of billionaires has arisen over the last few years, and if you're in private banking, you know that up to 90% of the money you're taking in is tainted," he said.

"Bankers don't ask anybody where they got their money from, only what they want to do with it."

Besides, he added, every bank knows that if it does not take someone's money, other banks will.

His own career as a banker in Switzerland ended abruptly in 1971 after regulators discovered $12 million in commodity losses secretly racked up by his head trader.

"I had my own little Nick Leeson," Mr. Erdman recalled, referring to the Singapore derivatives trader who caused the collapse of Barings.

As a member of the bank's management and a shareholder, Mr. Erdman was deemed responsible for the loss and found himself in a Swiss jail, although he says he was unaware of what had happened. With little else to do, he drafted his first novel, "The Billion Dollar Sure Thing," about a Swiss gold swindle. When freed on $100,000 bail, he caught the next plane to London with little more than his manuscript and an uncertain future ahead of him.

The novel took off, and so did his writing career.

"It was what you call a successful career change," Mr. Erdman chuckled.

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