Austria seeks whistleblowers amid wave of scandals

* Plans to give white-collar whistleblowers protection

* New special prosecutor units for white-collar crimes

* Series of financial scandals linked to politics

By Boris Groendahl

VIENNA, Aug 20 (Reuters) - Austria is to give whistleblowers reduced penalties and create special prosecuting units to try to stem a tide of white-collar crime and corruption, much of it linked to politicians.

Investigations into the near-collapses of a bank close to the late rightist leader Joerg Haider and of real estate groups with links to politics have threatened to overwhelm understaffed and underqualified prosecutors, and put the spotlight on Justice Minister Claudia Bandion-Ortner.

The minister on Friday told reporters: "Corporate crime is getting ever more complex. We need to rearm in the fight against white collar crimes and corruption."

Bandion-Ortner, a judge who presided over the court that handled the highly political BAWAG banking scandal three years ago, said whistleblowers would in the future get away with a fine rather than prison if they helped to secure a conviction.

The rule mirrors a provision in Austrian antitrust law, where 90 percent of all cases are discovered because members of a cartel come clean to authorities.

Critics say a system where prosecutors must report cases to the Justice Ministry, which can tell them to halt investigations, leads to prosecutors taking it easy on former politicians or people close to them.

But Bandion-Ortner said the system was necessary to ensure that prosecutors worked to uniform standards.

She said she would assign 40 of Austria's more than 300 state prosecutors to special units for large-scale white-collar crimes including fraud, breach of trust, false accounting, Ponzi schemes, tax evasion and money laundering.

Her initiative also includes making it easier to confiscate the proceeds of criminal activity.

Among cases that have been under investigation for months or years are the near-collapse of Hypo Group Alpe Adria, a bank controlled by Haider when he was governor of Carinthia province; coffee-roasting heir Julius Meinl's bank and its real estate group; and a 1 billion euro ($1.28 billion) auction of government real estate under former finance minister and Haider protege Karl-Heinz Grasser.

Many raids and arrests were made months after these cases started, many prominent suspects have not yet been interviewed, and none have yet been charged. (Reporting by Boris Groendahl; Editing by Kevin Liffey)