(Adds details, reaction from the vice president)
By Luis Jaime Acosta
MEDELLIN, May 16 (Reuters) - A former Colombian paramilitary commander said on Wednesday that his illegal armed group once allied with dozens of politicians and received funds from two local drinks companies, witnesses at a hearing said.
President Alvaro Uribe is already defending his government over a scandal in which 13 members of Congress are charged with colluding with paramilitary squads who once brutally controlled large areas of Colombia before a 2003 peace deal.
The accusations from the former commander surfaced at a sensitive time for Uribe as he seeks to persuade Democrats who control the U.S. Congress to approve a free-trade deal and extend a multimillion-dollar military aid package for Colombia to help fight a left-wing insurgency.
Ex-commander Salvatore Mancuso, who testified as part of the militia peace deal, said paramilitaries had pacts with politicians allowing them to secure allies in 35 percent of Congress in 2002 and loyal mayors across a northern province, witnesses said.
"According to Salvatore Mancuso, there were evident ties with the traditional political class, that is the Liberal and Conservative parties, which are compromised in the growth of the paramilitary phenomenon," said lawyer Sergio Guzman, who attended the session.
Uribe, a conservative attorney, is popular for his U.S.-financed crackdown on Colombia's four-decade-old conflict involving left-wing rebels and paramilitaries who have battled over territory and drug trafficking. He says the arrests show Colombia's justice is working better then ever.
Colombia's paramilitaries began as a self-defense movement financed by landowners looking for protection from guerrillas. But they soon got involved in massacres and murder of suspected rebel sympathizers, often in league with the armed forces and local authorities, rights groups say.
Reporters were barred from the Mancuso hearings at Medellin attorney general's office, but judicial sources and representatives of victims of paramilitary violence allowed inside also confirmed the details of the testimony.
According to a video recording of his testimony seen by Reuters, Mancuso identified Colombian companies he alleged were involved in financing the illegal armed groups.
"I know of the case of Postobon and the case of Bavaria, companies that financed the paramilitary phenomenon," Mancuso said.
GROWING SCANDAL
He did not give details on whether companies were pressured to make protection payments or whether the alleged payments were made by their local product distributors.
Drinks company Postobon belongs to a large local conglomerate, while beer maker Bavaria was owned by a local enterprise until it was purchased by SABMiller <SAB.L> in 2005.
An official from Bavaria said the company was trying to determine details of Mancuso's accusations and a Postobon representative was not available for comment.
U.S. banana giant Chiquita Brands International <CQB.N> pleaded guilty in March to charges a local unit paid protection money to paramilitaries. The company agreed to a settlement of $25 million with U.S. authorities.
Mancuso on Tuesday charged he and other militia leaders met with Vice President Francisco Santos and Defense Minister Juan Manuel Santos in the 1990s before they were in government, witnesses said.
The defense minister dismissed the charges and said he met with paramilitaries in a well-documented effort to broker a peace deal, and the vice president invited prosecutors to investigate him.
Uribe has furiously defended his government over the suspected ties with illegal paramilitaries and another scandal involving police wiretapping his political opponents and journalists.
"I have every confidence in this office, in the honesty of the vice president of the Republic and my companions who make up the national government," Uribe told local Caracol radio.
Uribe has reduced guerrilla violence and disarmed 31,000 paramilitaries. Their commanders are imprisoned under the deal handing them short sentences for giving up the gun and confessing to atrocities and massacres they committed in the name of counterinsurgency.
Rights groups say former warlords have kept criminal and drug-trafficking networks alive despite the peace deal. (Additional reporting by Patrick Markey in Bogota)
