Germany's foreign ministry said on Sunday it was probing past unusual billing practices at its Paris embassy after reports of an undeclared cash fund to pay staff for special events.
Foreign Minister Sigmar Gabriel has ordered a "special inspection" into the allegations, which first emerged amid a dispute with two former employees, the ministry said in a statement sent to AFP.
In the case first reported by Le Monde daily, a former butler and head waiter had accused the embassy of using fake invoicing practices to channel money into a fund used to give staff undeclared cash for overtime work.
The men claimed they were fired for criticising the system, which had been used during events organised at the ambassador's residence on behalf of private companies such as BMW and Mercedes.
Le Monde estimated that staff had received "hundreds of thousands of euros" in cash payments since 2007.
Germany's foreign ministry, after initially saying only that it was looking into the claims, now admitted to past irregularities, in reply to a question from a Green Party lawmaker.
The billing practices "did not meet the usual standards", senior foreign ministry official Walter Lindner wrote in a statement first reported by the Koelner Stadt-Anzeiger daily.
The Greens lawmaker, Franziska Brantner, told the Cologne newspaper that the matter "must be completely cleared up and those responsible ... held accountable".
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