Several German media outlets reported on Saturday that prosecutors had conducted searches of both Krauss-Maffei Wegmann's Munich (KMW) premises and the homes of accused individuals on Thursday at the request of Greek state prosecutors.

According to the Munich-based national newspaper Süddeutsche and two German public broadcasters, NDR and WDR, the searches related to KMK sales of Leopard-2 tanks and PzH Howitzers artillery vehicles to Greece about 10 years ago.

The sales were worth more than 1.7 billion euros ($2.1 billion).

Tax evasion or bribery, money laundering?

The three outlets said the allegations centered on suspected bribery and money laundering. Athens prosecutors were looking into whether Greek procurement and military officials had been bribed by KMW.

Greek media have said that Greek prosecutors want to press charges against 13 persons, mostly former employees of German armaments firms.

Files seized from KMW

Krauss-Maffei spokesman Kurt Braatz said on Saturday that Munich prosecutors had taken document files during Thursday's searches.

Workers assemble a motorized PzH Howitzer

"There is no investigation into corruption," Braatz said, reiterating past denials by KMW. He added that time limits for the prosecution of such allegations had expired.

KMW tax returns signed in 2004 and 2005 had been checked by auditors and submitted to prosecutors before they opened the current probe, Braatz said.

"We regard the continuation and outcome of the investigations in a relaxed manner," he added.

Prosecutors tight-lipped

Senior prosecutor Thomas Steinkraus-Koch confirmed that Thursday's searches had taken place but declined to give further details, citing tax confidentiality rules.

Scrutiny has grown in recent years on German arms exports.

Braatz said KMW sold 1.7 billion euros ($2.1 billion) worth of Leopard-2 tanks to Greece in 2003.

The Süddeutsche said KMW's Howitzer sale to Greece took place in 2000 and was worth about 190 million euros.

ipj/pfd(Reuters, dpa, AFP)