Germany's Siemens in oil-for-food investigation

FRANKFURT, Jan 3 (Reuters) German industrial conglomerate Siemens is being investigated for possible abuses of the scandal-plagued United Nations oil-for-food programme for Iraq, a German prosecutor said today.

''There is a suspicion of a breach of foreign trade law,'' Wolfgang Traeg, senior public prosecutor for the German city of Nuremberg, told Reuters.

The investigation is part of a worldwide probe into more than 2,300 companies and some governments accused of having abused the 64-billion dollars humanitarian programme, which ran from 1996 until 2003.

It coincides with a separate investigation by Munich prosecutors into a suspected bribery and embezzlement ring at Siemens' telecoms equipment division involving hundreds of millions of euros.

The oil-for-food programme was designed to soften the blow to civilians of international sanctions against Iraq by allowing Iraq to sell oil to finance purchases of humanitarian goods.

Prosecutor Traeg said three divisions of Siemens -- turbines unit Power Generation, power distribution unit PTD and healthcare unit Med -- were under investigation.

The as yet unnamed individuals are suspected of having bribed Iraqi officials with hundreds of thousands of euros to win contracts under the oil-for-food programme.

In total, an independent US enquiry has found that companies diverted 1.8 billion dollars to officials of ex-Iraqi leader Saddam Hussein's government. Saddam was hanged last week.

Siemens said it had no evidence that any of its employees had acted improperly. ''According to our current information, none of our staff infringed the law,'' a spokesman said.

German industrial gases group Linde has confirmed that it, too, is being investigated, and has said it is cooperating fully with the authorities.

REUTERS PB BD2039