Iraqi authorities have taken a police unit with hundreds of officers out of service because of possible complicity with death squads. The action follows a mass kidnapping in Baghdad earlier this week.
The authorities acted following an attack Sunday on a frozen food factory in western Baghdad.
Gunmen stormed the factory and shot two workers and abducted 24 others. Seven of the workers were later found dead, while the fate of the others is unknown.
Sunni leaders accused security forces of allowing Shi'ite militias to carry out the attack on the factory.
The U.S. military spokesman in Iraq, Major General William Caldwell, said the Iraqi police brigade in the area of the factory has been taken off duty and ordered to undergo retraining for alleged complicity with militias.
"There was clear evidence that there was some complicity in allowing death squad elements to move freely, when in fact they were supposed to be impeding their movement," he said.
Meanwhile, violence continued around Baghdad and elsewhere in Iraq.
Iraqi security officials say a bomb attack against Iraq's industry minister killed around a dozen people and wounded scores more in southern Baghdad. The minister, Fawzi al-Hariri, survived the attack, but three of his bodyguards died.
The bombing occurred as the minister's convoy was passing through a predominantly Christian neighborhood. Several buildings were severely damaged and may cars were destroyed.
An angry resident blamed the U.S. and the Iraqi governments for Iraq's continuing violence.
He said the government and the Americans have had three years, and, in his view, nothing has been done to help the people.
And violence continued outside Baghdad. In one incident police said a suicide truck bomber attacked Iraqi army headquarters in western Ramadi, wounding many people.