FRANKFURT -- German police raided the homes and offices of former DaimlerChrysler staff suspected of scamming the carmaker and seized evidence in a breach of trust investigation, prosecutors said on Wednesday.
The probe centers on allegations that former employees used company assets for private construction projects or took bribes from a business partner of the German car maker, the Stuttgart prosecutor's office said in a statement.
It did not identify the suspects, some of whom it said had worked in the marketing or construction departments at the world's fifth-biggest carmaker.
The investigation has already seen heads roll at Daimler, which sent the head of its German marketing organization into retirement at the end of last year and sacked two other executives implicated in the case.
"We are conducting an investigation and are working closely with prosecutors. Although the final report is not yet ready, we have also taken measures against staff," a spokeswoman said.
The case arose when an anonymous tipster suggested the company look into irregularities in parts of its marketing organization, she said.
German media term the probe the "Majorca Affair" because one former official is suspected of using company staff to help build a house for his girlfriend on the Mediterranean island.
Officials from the prosecutor's office and the Stuttgart police fraud unit conducted raids in the Berlin, Munich and Stuttgart regions on Tuesday and Wednesday, the statement said.
"The documents seized during the searches now have to be evaluated," it said, adding it could not state how long the investigation would continue.
Prosecutors said last week their probe had widened to include 11 people, most of them DaimlerChrysler staff.
One company source said last week that in addition to using company assets for personal purposes, the suspects may have sold discounted cars to unauthorized dealers in return for kickbacks.
Prosecutors said the dubious construction projects took place between 2001 and 2003, while the suspected bribery cases occurred from 2000 to 2002.
The probe adds a headache for Mercedes, which is battling an earnings slump, weak sales and quality problems in some cars that have dented the brand's elegant image.
"These incidents are very regrettable, but we acted immediately as soon as we realized these things were going on, and we will do so in the future as well," Mercedes Car Group division chief Eckhard Cordes told the newspaper Die Zeit. "We are doing what needs to be done even if this makes headlines, because this is a matter of corporate ethics."