Union Bank of Switzerland is offering U.S. customers an investment product with timeless appeal: gold bars.

And, in an effort to outwit counterfeiters and cut the cost of gold transactions, the bank's gold bars are being embossed with its logo in a complex, hologramlike image.

The bank's patented "kinegram" is a tamper-proof device that uses diffusion optics to create a rainbow-colored moving picture. Union Bank uses kinegrams to identify its line of pure gold bars.

Late last month, the bank introduced the product in Singapore, where it expects the kinebar to find great popularity. When the bank offered the bars last year in Switzerland, they quickly sold out.

Peter E. Guernsey Jr., managing director of Union Bank's private bank in New York, said there are clients, usually outside the United States, who routinely keep a percentage of their portfolio in gold.

While it is often recommended that investors keep 5% of their portfolios in commodities, Mr. Guernsey notes that many choose gold as the "safe haven currency" in case of an economic crisis.

Mr. Guernsey also said some investors prefer to take physical possession of their gold, usually storing it in safe deposit boxes, sometimes in several countries.

Assayers can catch the handiwork of counterfeiters who try to sneak zinc into purportedly pure gold bars. They also snare fees of approximately 3% of the gold's value.

Consequently, the bank decided to use kinegrams to appease security concerns of gold customers and eliminate assaying costs.

Union Bank embosses the kinegram onto gold bars it mints at its Argo- Heraeus refinery in southern Switzerland. It owns international rights to apply kinegram technology to precious metals.

Kinegrams are also used to secure bank notes, passports, and visas.

The Zurich-based bank hired Swiss scientists at Landis & Gyr to create the tamper-proof identification. If an attempt is made to remove the kinegram - to apply it, for instance, to counterfeit bars - the logo self- destructs.

Kinegrams are touted as "forgery-proof." A rainbow pattern of fine lines dances around the Union Bank logo while two rings flash alternately.

The words "UBS Kinebar-UBS Kinebar" are written in a microscript between the rings and can only be seen using a magnifying glass.

The idea is that the bars, already designated as pure, will not have to go through the assaying process each time they change hands. Other banks interested in selling kinebars can buy them from Union.

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