WASHINGTON (AFP) - Technology giant IBM said Monday it had been temporarily suspended from seeking new business with US federal agencies, amid an investigation into possible procurement irregularities.

The suspension was issued by the Environmental Protection Agency (EPA), which is probing “possible violations” of federal procurement rules in a bid for EPA business originally submitted in March 2006, IBM said in a statement.

The move applies to all federal agencies and IBM business units, although existing contracts may continue unless a particular agency says otherwise.

IBM also said the US Attorney's Office for the Eastern District of Virginia had served the firm and certain employees with grand jury subpoenas requesting documents and testimony on interactions between the EPA and IBM.

The company said it had “served the federal agency community for many decades as a vendor in good standing, and is committed to the highest standards of business ethics.”

IBM said that prior to the suspension notice, it did not know it was being investigated, and intends to challenge the action.

It has 30 days to contest the scope of the suspension, which could continue for up to a year while the investigation continues.