Tafa Balogun was taken into custody by police officers acting for the Economic and Financial Crimes Commission (EFCC), but has not yet been charged.

A commission official, who spoke to the Agence France Presse news service on condition of anonymity, confirmed Mr Balogun’s arrest but would not comment further.

Mr Balogun has been under a cloud of suspicion since the EFCC announced in January that it had traced large sums of illicit money in 12 bank accounts back to him.

He resigned suddenly as inspector general of police after the allegations came to light.

A federal high court in Nigeria’s commercial capital, Lagos, this week granted a request by the EFCC to freeze 2.7 billion naria (A$27m), suspected to have been diverted by Mr Balogun into five separate bank accounts.

Mr Balogun’s lawyer said he did not expect charges to be laid until the end of the week and criticised authorities for denying him access to his client.

“I have not been able to see the former inspector general since Monday night when he was arrested,” Tunji Abayomi told reporters.

He has accused the EFCC of unfairly hounding Mr Balogun in a “careless, unwarranted and unjustified abuse of authority.”

Mr Balogun is the latest high profile Nigerian figure to be caught up in a new anti-corruption push by President Olusegun Obasanjo.

Last week, Education Minister Fabian Osuji was sacked over a bribery scandal.

In a televised broadcast, the president announced Mr Osuji’s dismissal, saying that he had given a 55 million naira bribe to Senate President Adolphus Wabara and several legislators to increase his ministry’s budget allocation for 2005.

Mr Wabara has denied the claims and resisted calls to quit as the leader of the Senate.

President Obasanjo has been waging a campaign to rid Nigeria of the rampant corruption that has left the country ranked as the world’s third worst offender.

Transparency International’s 2004 index of corruption placed only Bangladesh and Haiti ahead of Nigeria.