The Malaysian government has refuted an Indonesian news report that claimed that the funding for alleged terrorist Dr Azahari Husin and another Malaysian on the wanted list had originated from Malaysia.

Updating its report, Bernama quoted Deputy Internal Security Minister Noh Omar as saying today that the government did not assist or support any group involved in terrorism, not only in Malaysia but also anywhere else in the world

Nevertheless, the government was prepared to undertake an investigation and take action if there was proof, he told reporters at Parliament House.

Noh said it was improper to make allegations through the media.

"If there is any truth to such allegations and there is proof, we promise that we will investigate and take action," he said.

Bernama had drawn from the report published yesterday by influential Indonesian newspaper Media Indonesia , which had quoted an intelligence observer Wawan H Purwanto.

The report said a foreign diplomat (it did not state from which country) had acted as the intermediary and was responsible for the channeling of funds to Azahari and his accomplices.

The money was made available to them by a courier from Malaysia who went by the name of Suf, added the report.

"The money came from sympathisers of Azahari and Noordin M Top in Malaysia," Wawan was quoted as saying.

"The diplomat who had international immunity facilitated the funds to the terrorist group with the aim of creating instability," he added.

Wawan, whose background was not stated, said he had informed the Indonesian parliament and the nation's leadership to carry out an in-depth investigation on the matter.

On the activities of Suf, Wawan said the information was obtained from the Malaysian police.

At first Suf was said to have transferred the funds through banks but when his activities were detected he changed his modus operandi.

'Cut-out' system

The newspaper reported that Suf then used the "cut out" system to facilitate funds transfers whereby individuals were used to ferry money for only once and after that all dealings with the person were cut off.

According to Wawan, between 2002 and 2003 some foreign based banks in the country had been used for the money transfers but he did not dare to specifically name them.

Azahari, a former lecturer with Universiti Teknologi Malaysia, was said to be a bomb expert and key member of the regional terror network, Jemaah Islamiyah.