Austria investigates yacht sale to North Korea's Kim

Austrian prosecutors' spokesman Gerhard Jarosch said the deal involving two yachts, seven Mercedes saloons and some musical instruments violated U.N. sanctions against Kim's isolated Stalinist state imposed over its nuclear bomb tests.

Italy said on Tuesday it had broken up the sale with the help of Austrian investigators and seized two yachts meant for Kim. The status of the cars and instruments was unclear.

"An investigation has been launched against an Austrian businessman and a Korean middleman, who may be North Korean, over this illegal order. The offence is punishable by up two years in prison," Jarosch said.

He said the suspects were in Austria but not under arrest. He declined to say if they had been questioned, citing the confidentiality of an ongoing investigation.