Chen has admitted to breaking the law by not fully disclosing campaign donations made to him [AFP]

The order on Sunday came after prosecutors searched Chen Shui-bian's residence in Taipei and took away boxes of documents.

"The accounting books and computers we obtained could help with clarifying the case,'' Chu Chao-liang, spokesman for the supreme prosecutors' administration, said.

Chen has admitted that he broke the law by not fully disclosing campaign donations made to him.

He also said that his wife, Wu Shu-chen, had wired $20 million to a bank account in Switzerland. Taiwanese media reports said that Wu told prosecutors that the money included unspent donations.

Investigation launched

Chen quit his Democratic Progressive Party (DPP) on Friday after Liu Chao-shiuan, Taiwan's president, confirmed that an investigation had been launched into the money laundering allegations.

"I have to say sorry to DPP members and supporters with a heavy heart. I let everybody down and caused irreparable damage to the party. This was not my intention but I made mistakes," he said in a statement.

"To show my deepest remorse, my wife Wu Shu-chen and I leave the DPP from now," he said.

The Taiwanese investigation follows a similar move by Swiss authorities.

Shih Ming-teh, a former leader of the DPP, said on Sunday that the $20m sent to Switzerland could be the tip of the iceberg.

He accused Chen of taking at least $85m from an entrepreneur bidding for bank ownership during a spate of mergers initiated by the government in 2005.

Copies of Swiss documents obtained by Hung Hsiu-chu, a Kuomintang MP, showed that Chen's son and daughter-in-law had transferred $31m into her Swiss bank accounts in 2007.

The couple left Taiwan on August 9 before the case came to light, according to Taiwanese authorities.

A string of corruption scandals implicating Chen, his family and another senior DPP officials have tarnished the party's image and played a part in its defeat in a presidential vote in March.

Chen was already under investigation for allegedly embezzling $480,500 in special expenses from the government while he was president, and his wife is on trial for corruption and document forgery in the same case.

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