The man, Licio Gelli, is the former grandmaster of the Italian P2 Masonic lodge and was sentenced in 1994 to 12 years in jail for his part in a major bankruptcy fraud, but disappeared while on parole.

Mr Gelli, 79, was arrested last week in southern France after a joint operation by French and Italian police tracked him to Cannes - he is being detained in hospital after suffering a slight stroke and is also reported to have made an unsuccessful attempt to kill himself.

Buried treasure

Police say they discovered documents in Gelli's Cannes apartment, which led them to the gold, in the form of 165 unmarked ingots hidden in six, terracotta flower pots, decorating the terrace of his villa in the Italian province of Tuscany.

The bars were taken to a local bank for safe keeping while police continued their search for more possible buried treasure and hidden documents.

It is not the first time that Mr Gelli has failed to prevent his personal fortune being confiscated by police.

He's previously had gold bars belonging to him seized by justice authorities from banks in Argentina and Switzerland.