ATHENS - Greek police said Wednesday they have arrested 12 members of a gang that forged documents for migrants trying to reach central Europe, hailing the swoop as an important blow against a major people-smuggling operation.

The 12 - nine Pakistanis, an Egyptian, an Iraqi and a Syrian - were held in raids on three flats in central Athens where police said they found and seized "whole laboratories for producing fake papers".

Around 630,000 people have illegally entered the European Union this year, more than half of them landing in Greece, and the bloc has struggled to formulate a strategy to deal with the crisis.

The gang is "one of the most important criminal people-smuggling organisations" helping migrants enter Greece illegally and move on to countries in central Europe, police said in a statement.

The detained suspects have been handed over to Athens prosecutors while police hunt for more accomplices.

Would-be migrants paid the gang up to 3,000 euros ($3,400) and would leave Greece illegally through airports or by inflatable boats from the western coast, bound for Italy, police said.

Part of the network operated on the island of Kos in the Aegean Sea, close to the Turkish coast, from where thousands of migrants attempt the risky sea crossing every day.

After migrants landed on the island, the suspected smugglers would give them false papers to let threm travel to Athens and then on to central Europe.

The Kos end of the operation worked with acomplices in Turkey who would help the migrants get to Kos, often in small boats with minimal fuel - putting the travellers' lives in danger.

On arrival in Greece the migrants are often held in apartments to stop them finding other smuggling gangs, police said. An Afghan man was arrested in Athens on Monday for holding 34 migrants in a flat, including 12 children.