The neighbors fumed about Martin Frankel. They bristled at the surveillance cameras and the armed guards he installed on a private driveway in a tony enclave of Greenwich, Conn., and they hated the parade of limousines through his driveway. Even more irritating--few in the area had even laid eyes on the guy.

Locals peered over the fence at Frankel's estate and wondered: What is going on in there?

The answer, according to law enforcement authorities: a massive financial crime that they are just starting to unravel. Frankel, a 44-year-old stock trader with a gift for changing identities, has disappeared along with somewhere between $200 million and $3 billion, most of it apparently drained from a handful of insurance companies in a complicated scam that involved, among others, some high-powered attorneys, a well-intentioned Catholic priest and Walter Cronkite.

"It looks like the biggest fraud in the history of modern finance," said John Q. Kelly, an attorney for the Rev. Peter Jacobs, one of many who authorities say were duped by Frankel.

The FBI and insurance regulators are now on the case and are hunting for Frankel, who hasn't been seen in weeks. The bizarre tale first made local headlines in early May, when firefighters responded to an alarm at Frankel's estate. Nobody was home but the place was packed with made-for-television clues to an elaborate fraud.

According to the FBI, burning documents were found in a pair of fireplaces and a filing cabinet in the kitchen, along with fire extinguishers, apparently used in an unsuccessful effort to douse the flames. Police later recovered some handwritten documents, including a task list with reminders to "Launder money" and "get $ to Israel get it back in."

When police combed the $3 million compound, they found a 12-room home converted into a high-tech command post, packed with 100 computers, electronic locks, floodlights and a master bedroom wired with three 32-inch color televisions. They also came across astrological charts that Frankel consulted to divine answers to questions like "Will I go to prison?" and "Should I leave" and "Will I be safe?"

The man behind this bewildering scheme is a high school dropout who grew up in Toledo, Ohio, the son of a local magistrate. Frankel has been maintaining a scrupulously low profile for years. He stayed away from cameras and instructed the University of Toledo to seal his student records. He kept personal interactions to a minimum.

"He was a true recluse," said Philip Russell, a Greenwich attorney hired by some of Frankel's neighbors. "Yet his driveway was a hub of an inscrutable commercial enterprise, which was characterized by cars coming and going at all hours of the day and night and enough telecommunications equipment to satisfy the needs of a medium-size corporate headquarters."

A self-described genius, Frankel boasted on a resume that "during his early elementary school tenure he was tested, without preparation, using the standard Stanford-Binet IQ test, on which he received a score of 194, one of the highest scores ever registered by a child on this popular IQ test."

Even more impressive, he claimed he "has unearthed a method he uses to predict the movement of financial instruments" based on news events. The system, called "informational analysis," yielded "a 92 percent to 96 percent rate of accuracy"--whatever that means.

His career as a stock trader began when he applied in 1985 to the Toledo office of Dominick & Dominick, a small and now defunct brokerage firm. Owner John Schulte was initially skeptical, but his wife was charmed by this unkempt and eccentric newcomer, and Frankel got the job.

"He talked a great game," said Schulte, now a lobbyist in Toledo, in an interview yesterday.

But Frankel did nothing, Schulte recalled. In fact, he seemed paralyzed. Instead of trading and producing profits for clients, Frankel lazed about the office and talked endlessly about market moves that he had brilliantly foreseen but had not bothered to bet on. Apparently, Frankel fretted that mistakes would tarnish his self-created legend, and weirdly enough, remaining steadfastly on the sidelines enhanced his myth. "He couldn't pull the trigger," Schulte said. "Still, clients would beg him to trade."

Worse, Frankel wouldn't wear a tie or clean his office. To keep him away from clients, Schulte moved him to a tiny room, known as "the closet," packed with state-of-the-art equipment. But after six months of inaction, Schulte said, he got fed up and fired Frankel. To Schulte's shock, his wife was livid, and in a matter of months, she moved out with the couple's two young daughters and began a romantic relationship with Frankel that Schulte said lasted several years.

Fired from a succession of other brokerages, Frankel built a small financial empire on his own. Pitching himself as a stock-picking whiz, he persuaded a handful of small Southern insurance companies--most of them selling "pre-need" burial services--to send him millions of dollars to invest through a company he controlled called Liberty National Securities.

The carriers funneled cash to Frankel for years, and it was only two months ago that insurance regulators in Mississippi noticed something strange about the transactions and started asking questions. Why, they wondered, were these companies using such a relatively unknown investment house, rather than a more established company?

Worried, one of the regulators dispatched a friend in New York to visit Liberty's listed Wall Street address.

"The friend called back and said the address doesn't exist," said George Dale, Mississippi's insurance commissioner, in an interview yesterday. "We smelled a rat."

That whiff might have come too late. A handful of insurers in states including Mississippi, Arkansas and Virginia have filed for bankruptcy. Dale said that as much as $600 million has gone missing.

As Frankel put the insurance money to work, he methodically cultivated an aura of respectability. In the summer of 1998, he approached Jacobs, a New York priest who traveled in well-heeled circles. Introducing himself as David Rosse, Frankel described himself as a rich Jewish agnostic with an affinity for Catholic causes, ready to spread his riches for humanitarian purposes. He invited Jacobs to help him dole out the millions and Jacobs agreed.

"Rosse presented himself as someone who had made money trading in the stock market and had become familiar with the Catholic Church and saints and wanted to be saintly in his lifestyle," said Kelly, his lawyer.

The St. Francis of Assisi Foundation was born. But Frankel bestowed only a small fraction of the promised cash on a few charities, though he endlessly touted his links to Jacobs as evidence of connections to the Vatican, a quick way to authenticate his bona fides. Then he attempted to parlay those links into even greater cachet. He listed luminaries such as Walter Cronkite as members of St. Francis's board, although the legendary newsman had explicitly turned the invitation down.

"Father Jacobs called me earlier this year saying that he'd been introduced to this man who was going to give away a billion dollars, and he asked if I would sit on the board of advisers," Cronkite said by phone yesterday. "I turned him down cold."

Cronkite believes that Jacobs, who is now retired and living in Rome, had no idea that he was working with a con man. "We were both kind of exploited," he said.

Authorities could spend weeks sifting through the maze of transactions and shell companies that they say kept Frankel's fraud a secret for years. Federal regulators are attempting to seize $14 million in accounts held by Frankel in New York, but that could be locking the vault after the bulk of the cash has vanished.

Now, as his former Greenwich neighbors sigh with relief, insurers scramble for missing cash, the government searches for a missing man, and bit players in this drama scratch their heads.

"It's a bizarre story," said Walter Cronkite. "I wish I were covering it."

CAPTION: Up in smoke? A 1970 high school photo of Martin Frankel.