"The inquiry is progressing," he told the public radio station Jedynka on Thursday. "We could have dealt rapidly with this matter in Iraq, but we prefer to go all the way up the line."

According to the daily Zycie Warszawy, military police have arrested five Polish officers and two civilians.

The officers include the head of a liaison group with civilian authorities that is notably responsible for the distribution of aid project contracts in areas of Iraq under Polish military administration, the paper added.

It said those arrested are suspected to have pocketed bribes of $250,000 to $500,000.

Poland is a key Washington ally in Iraq, where it commands a zone south of Baghdad, heading a division of 5000 troops from different countries, including 1700 of its own.