The British Foreign Office announced on Monday that it was investigating the loss of a satellite phone in Iraq after reports claiming a $890,000 US bill has been run up on the device after it was stolen by insurgents.

The telephone which was registered with the British Embassy in Baghdad was disconnected from use in June after the company which leased it noticed something suspicious in the billing pattern.

British Tabloid The Sun claimed that the phone was stolen by insurgents who used it in Saudi Arabia and Yemen although the Foreign Office could not confirm this claim.