SYDNEY : Papua New Guinea’s anti-corruption watchdog issued a warrant on Monday for the arrest of Prime Minister Peter O’Neill, reports said.

The warrant relates to allegations that O’Neill personally authorised the illegal payment of millions of dollars from the government to law firm Paul Paraka Lawyers, the Australian Broadcasting Corporation (ABC) said.

O’Neill has strongly denied the allegations, saying that a letter the opposition produced bearing his signature to order the payments via the finance ministry was a fraud. Sam Koim, the head of the anti-corruption agency Investigation Task Force Sweep which has been investigating the case, told the Australian Associated Press the warrant had been served on the prime minister . O’Neill, elected in 2012, was expected to be questioned by police later in the day.

However the Post-Courier web site in the capital Port Moresby reported that the prime minister’s office was trying to obtain a stay order to block the arrest.

In January, the watchdog said it had no case against O’Neill and no further investigations would take place unless new evidence surfaced.

In October, Investigation Task Force Sweep charged Paul Paraka Lawyers with conspiracy to defraud, stealing by false pretence and money laundering.

It alleged the firm, one of the Pacific nation’s largest law firms, submitted fraudulent bills for legal work performed for the state.