Former Iraqi central bank chief rejects graft charges

BAGHDAD (Reuters) - The former governor of Iraq's central bank on Saturday denied parliamentary charges of corruption on Saturday, saying he was the victim of a government campaign to try and control the autonomous bank's foreign reserves.

Iraq's cabinet last month ousted Sinan al-Shibibi after a parliamentary investigation into central bank officials accused of abusing the bank's dollar auctions.

Local authorities have issued arrest warrants for Shibibi, who has left the country, and other bank officials, a decision that has heightened investor concerns Prime Minister Nuri al-Maliki's government is interfering with the bank's autonomy.

"I think the main problem was that the central bank did not fund the government because the law does not allow it," Shibibi told reporters, speaking from Geneva.

"The accusations and criticism ... are unjust and incomprehensible."

Shibibi did not say whether he will return to Baghdad to face the charges against him, which are being investigated by an independent integrity watchdog.

The allegations of corruption at the central bank are the latest chapter in a long-running dispute between the government, its allied lawmakers and the central bank board over the institution's autonomy.

A parliamentary commission last week said there had been violations in dollar sales by the bank for importing goods, false documents for importers, and a lack of control of how dollar auctions were monitored.

Maliki, a Shi'ite, last year won a court ruling that put the central bank and other independent bodies under more cabinet supervision, a move his opponents said would allow the Shi'ite premier to consolidate his power.

Iraq's political system has been mired in infighting among Shi'ite, Sunni Muslim and ethnic Kurdish blocks, some of whom accuse Maliki of failing to fulfill power-sharing agreements in the cross-sectarian government.

Corruption is rife in the OPEC nation as its oil industry rebuilds and foreign investors seek to reconstruct its infrastructure after years of war and sanctions, even before the 2003 invasion that ousted Saddam Hussein.

(Editing by Patrick Markey and Sophie Hares)