"The interior minister has ordered the setting up of a commission of
enquiry to look into this matter," Major General Hussein Kamal, the deputy minister in charge of intelligence, told news agency AFP.
The move came after US Major General Joseph Peterson, in charge of training the Iraqi police, told the Chicago Tribune newspaper that 22 policemen, dressed in police commando uniforms, were arrested in late January in Baghdad as they took a Sunni away to be shot.
Death squads have also been responsible for many deaths in Iraq's main southern city of Basra, a British officer told AFP.
Major Alex Wilson said more than 140 killings had been carried out between November and January, many by "men masquerading as Iraqi policemen or members of the former Department of Internal Affairs of the interior ministry."
He added that this was double the number killed between May and November.
"We are doing our best to counter the death squads. We want to take them off the street," he said.
Those killed are believed to include tribal chiefs, members of minority communities and even criminals like oil smugglers.
He said "many of these killings can be called de-Baathification assassinations," a reference to reprisals against members of Saddam Hussein's former ruling Baath party.
Sunni Arab organisations have repeatedly accused rogue elements within the security forces of arresting and killing Sunnis who provide the backbone to the ongoing insurgency.
A spokesman for the Committee of Muslim Scholars, one of the main Sunni Arab organisations, told AFP the death squad discovery was not an isolated incident.
"It's not just one death squad. There are many," said the spokesman who declined to be named because of fear for his life.
"In the northern Baghdad district of Hurriyah alone, some 70 young men from our community have been killed by these units, and the overall toll figure is likely to be more than 1,000 and includes 20 imams (religious leaders)," the spokesman said.
The committee has repeatedly denounced such crimes and called on the United Nations to investigate the allegations, he said.
A US diplomat said that respect for human rights remained a top issue of concern for Washington.
"Human rights is at the top of our list when we engage with Iraqis at all levels, particularly with ministries associated with security," he said.
US Ambassador Zalmay Khalilzad said in an article published Sunday by the Los Angeles Times that the new Iraqi government, currently being formed after December general elections, needed to inspire the confidence of all sections of the Iraqi community.
"Elected leaders need to govern from the centre, not the ideological extremes.
"This is particularly true in the security area, where the new government must continue increasing the capability of Iraqi security forces while ensuring that defense and interior ministry officials are chosen on the basis of competence, not ethnic or sectarian background," the ambassador said.
He also pointed to the need for the government to start demobilizing factional militias set up by different groups across the country.
Major General Peterson suggested that the policemen arrested owed their allegiance to the Badr Organisation, a militia loyal to the Shiite Supreme Council for the Islamic Revolution in Iraq.
"There is no denying that there are militia forces present in Iraq ... Some of those militia forces have indeed integrated with the Iraqi security forces and that's what happened in that incident," US spokesman Major General Rick Lynch told reporters Thursday.
The discovery of the alleged death squad came by chance when the policemen, who had been stopped at an Iraqi army checkpoint, readily admitted they were taking a prisoner away to shoot him, Major General Peterson said.
In an interview with AFP last month, Mr Peterson had said the interior
ministry was taking action to address problems of abuse.
"The minister has fired four brigade commanders in the special police
because of the amount of reports of abuse occurring in their units," he said.