One of Afghanistan's most senior government prosecutors said yesterday that he was forced into retirement after aggressively promoting corruption investigations against top officials, including one of Hamid Karzai's most trusted aides.

Fazel Ahmed Faqiryar, a lawyer well-regarded by foreign rule-of-law experts, lost his position as deputy attorney general at a time of growing US impatience with President Karzai over his apparent attempts to block sensitive cases and to rein in the powers of the western-backed Major Crime Task Force, the so-called "Afghan FBI" hailed as the centrepiece of a new push against corruption.

Speaking in his flat in Kabul, Faqiryar said he was made to retire last week because of his stance against the corrupt activities of some of the country's best-connected people, including Mohammed Zia Salehi, the head of Afghanistan's National Security Council.

Salehi was arrested in July after being caught accepting a bribe of a car for his help in derailing a major fraud enquiry.

But there are fears that the breakthrough investigation, led by an elite unit supported by officers from the FBI and the UK's Serious Organised Crime Agency, could come to nothing after Karzai put massive pressure on the attorney general's office for Salehi to be released.

Yesterday Faqiryar said the Salehi investigation was just the tip of an iceberg of cases against top officials prepared by Afghan investigators and prosecutors. But he said nearly all had been stalled by Mohammed Ishaq Aloko, the attorney general who answers directly to Karzai.

"He was always asking us to delay that case on that governor or that minister. Or he would say we can't send that high-profile case to court," he said.

He said a number of cabinet ministers, Afghan ambassadors serving abroad and provincial governors have solid cases against them, largely involving money creamed off contracts or other illegal kickbacks.

The departure of Faqiryar will further heighten US concerns that Afghan anti-corruption measures are not receiving adequate support.

One western diplomat who works on rule-of-law issues, said pressure from foreign countries was not working and was unlikely to in the future. "These people are untouchables because there is no political will to do anything about it. No matter what outside pressure there is, Karzai always blocks these prosecutions, we have known that for a long time," the diplomat said.

At 72 years old, Faqiryar was due to retire, and Aloko had recommended his departure to Karzai more than a month ago, but nothing happened.

All of that changed when the palace was outraged by a television interview done by Faqiryar's deputy, Amrodin Wafa. He not only said that numerous ministers were under investigation, but that Salehi had been ordered three times to come to the attorney general's office to help investigators, but had refused.

Salehi was initially arrested on July, but was soon released after he called Karzai for help. The eight-month investigation, which included hours of intercepted phone calls, also revealed that Salehi was charged with dipping into a presidential slush fund to pay off Karzai's political allies.

After the short-lived arrest of his close aide, Karzai publicly made clear his fury with the MCTF, saying that foreigners were interfering in Afghanistan's affairs, and that the task force would be brought under his control and all its cases reviewed.

The Salehi scandal, the complaints of senior Afghan investigators and prosecutors that their work has been obstructed and Karzai's vow to neuter the MCTF has created a major row with Washington.

With fears that stories of Karzai protecting corrupt cronies could destroy critical support for the war in Afghanistan in the US Congress, which has already $4bn in financial aid in protest against Afghan corruption, Senator John Kerry travelled to Kabul this month to urge Karzai to take the issue more seriously.

While Karzai publicly promised to respect the independence of the MCTF his office has still not yet published a promised decree establishing its powers.

Faqiryar said that after a promising start the MCTF had been destroyed by political interference. "It was doing very well before with the help of the FBI, but I don't think they [will be able to arrest] high-profile people as long as certain elements interfere," he said. "The fight against corruption won't get anywhere."

• This article was amended on 31 August 2010. The original said there were apparent attempts to block sensitive cases and to reign in the powers of the western-backed Major Crime Task Force. This has been corrected.