FILE PHOTO: A North Korean flag flutters on top of a tower at the propaganda village of Gijungdong in North Korea, in this picture taken near the truce village of Panmunjom, South Korea, August 26, 2017. REUTERS/Kim Hong-Ji/File Photo

SINGAPORE (Reuters) - Singapore said on Wednesday it was investigating two local companies accused of supplying luxury goods to North Korea in violation of U.N. sanctions.

Citing a leaked draft of a U.N. report, British broadcaster BBC said earlier this week the two firms were OCN and T-Specialist, sister companies that share the same director.

“The Singapore authorities are aware of these cases and we are in correspondence with the U.N. Panel on them,” Singapore’s foreign affairs ministry said in a statement.

“In respect of the two companies mentioned in the BBC report - OCN and T-Specialist – our authorities have commenced investigations into these companies. However, we are unable to provide additional details as investigations are ongoing.”

OCN and T-Specialist could not be immediately reached for comment, neither could lawyer Edmond Pereira who local media reported was representing the firms.

The BBC said the companies have denied wrongdoing.

Under U.N. sanctions, it has been illegal to sell luxury items to North Korea since 2006. Singapore suspended all commercial trade with Pyongyang in November.