Jacko in exile: Star seen in Bahrain

Even when Michael Jackson goes into hiding, he continues to court controversy - this time dressed as a woman out shopping.

Rather than greet the day, Michael Joseph Jackson - flamboyant King of Pop turned skint King Lear - was almost certainly out shopping, quite possibly dressed as a woman.

An 11th-hour deal struck late last week appears to have saved the star from imminent bankruptcy. Where this leaves the 47-year-old singer, cleared last June of child molestation charges in California and largely resident in Bahrain since then, is less clear. But what details have emerged of his long stay show he hasn't lost his knack of conjuring up the bizarre in bulk quantities.

One morning in January, a peculiar entourage hit Marina Mall, one of a series of gleaming shopping zones that dot Manama, Bahrain's capital. Leila al-Aradi, an assistant at Mothercare, looked on in disbelief as the three Jackson children - led by a local woman invisible beneath an abaya, a traditional head-to-toe robe - dashed around the store for an hour trying out clothes and toys, until, arms full, they made for the checkout.

As they stood there, Ms al-Aradi noticed that the woman in the abaya was wearing men's shoes. "I looked up at him and mouthed: 'Michael Jackson'," said Ms al-Aradi. "But he wagged his finger to caution me against saying his name aloud." Next, the concealed Jackson made for a nearby shoe shop. Here, sales assistant Latif Muttath set about serving what he took to be a rich local woman. Until, that is: "I looked at the person's shoes and found they were men's shoes. That's when I guessed it was Michael Jackson."

Another Bahraini, a woman, guessed it was Michael Jackson when, entering the ladies' toilets at another mall, she spotted a curious figure loitering nervously inside. An innocent mistake, Jackson's office explained - he'd not been able to read the sign "Ladies" in Arabic on the door. But he was putting on make-up, claimed one witness.

Adel al-Maawda, one of the few strident voices of religious orthodoxy in Bahrain, said last month that the singer "should keep his concerts and his effeminate manners away from us", and grumbled: "We don't want him turning Bahrain into Las Vegas." But he could only go so far: Jackson is a friend of the crown prince, and his behaviour has been appropriately regal.

While being chauffeured around the Saar district a few days ago, the star caught sight of a villa he liked the look of. Telling his driver to stop, he told his assistants to knock on the door and ask the owner if he would sell. Astonished, the owner refused to do business, but invited him in to share dinner. Jackson stayed for four hours. "He's not someone the average, ordinary person meets," one resident said yesterday. "He's wrapped up in his family."

Bahrain boasts zero income tax and all the outlets considered essential by the wealthy: Rolex shops and Rolls-Royce dealerships. But it is not Dubai: you'll also find Marks & Spencer, Debenhams, Next, River Island, Body Shop, Benetton and Top Shop. Property is cheap - £300,000 buys a large villa with two swimming pools. Crime is almost unknown.

For now, Jackson's fate lies not in the eager hands of the record-buying public, but in the benevolent grasp of Sheikh Abdullah bin Hamad Al Khalifa, the son of Bahrain's ruler. Since the star's arrival in Bahrain, the music-loving sheikh has taken care of Jackson's material needs, but according to some accounts, the budding friendship between the prince and the showman soured after Jackson flew a dozen friends to Bahrain for Christmas, spending a fortune on festive gifts. The prince received the bill.

And still the spending goes on. It was claimed - and denied by his office - that Jackson bought a pair of villas in the flashy Amouage Islands development at Muharraq. To his massive fleet of luxury cars he has added a Bentley and a Rolls, plus a Jeep for the kids. He is said to be funding the construction of a mosque.

However, there are signs that away from the mad dashes around the malls, he may have been tightening his belt - or having it done for him. He is currently renting a ranch-style house set in four acres at Sanad, a low-key suburb. "It's not at all where the super-wealthy live," a Bahrain property expert told The Independent on Sunday yesterday.

Jackson's monthly rent is believed to be in the region of £7,000 - a fraction of the weekly costs of running his infamous Neverland estate in California.

The financial "restructuring" agreed last week has weakened Jackson's hold over his prize possession - 50 per cent of the publishing rights to more than 300,000 songs, including much of the greatest pop music, among it virtually all the Beatles' songs.

Details of Friday's deal between the Sony Corporation - along with Jackson, joint owner of the rights - and debt management specialist the Fortress Investment Group, now his main creditor, are shrouded in mystery. However, it leaves him with a new loan and reduced interest payments - in exchange for granting Sony an option to buy around half his stake in the song rights for $200m. Also unclear is the fate of Neverland, the singer's childhood theme park and mansion near Los Angeles.