Matt Crook, Dili – East Timor's deputy prime minister abused his power by securing a plum United Nations job for his wife in which she was overpaid thousands of dollars, a leaked ombudsman's report alleges.

The July 9 report by East Timor's Ombudsman Sebastiao Ximenes, obtained by AFP, recommends an investigation be opened into Jose Luis Guterres over allegations that he improperly gave his wife, Ana Maria Valerio, a job as counsel to the UN ambassador in New York in 2006.

Guterres's actions were "an abuse of power, and breached the applicable laws resulting in irregularities and prejudice to the state in favour of the family," the report said. "This conduct amounts to acts of collusion and nepotism," it said.

Appointees should be career diplomats who have worked through various lower-level posts, prerequisites Ana Maria Valerio did not fulfill," the damning report said.

The alleged abuse of power included the leader's wife being overpaid about 12,000 dollars in housing allowances reserved only for East Timorese diplomats and citizens working overseas who don't have homes, according to the report.

Guterres was appointed as East Timor?s ambassador to the United States in 2002 before becoming the country's ambassador to the UN.

He returned to East Timor in 2006 to take up the post of foreign minister, but before he left, he gave his wife her new job, breaking a number of anti-corruption laws in the process, the report says.

Current Foreign Minister Zacarias Albano da Costa was also accused in the report of failing to "immediately (stop) these payments to Ana Maria Valerio... after he took office in 2007."

Ombudsman Ximenes has passed the report to East Timor's prosecutor general. In August, opposition Fretilin party lawmakers called for Justice Minister Lucia Lobato and Finance Minister Emilia Pires to be sacked after a report by Ximenes alleged abuse of power by the pair.

The latest corruption scandal comes the same week that a proposal was put forward in parliament to more than double the monthly earnings of East Timor's lawmakers.