LONDON (Bloomberg) — American International Group Inc.'s financial products unit, which brought the firm to the verge of collapse with bad bets on credit-default swaps, is being investigated by UK prosecutors for possible criminal conduct.

Investigators are working with authorities in the US who are conducting separate reviews, Britain's Serious Fraud Office in London said yesterday in a statement. AIG said it is cooperating with the probe, which isn't related to insurance operations.

"We will use our full range of powers to seek information and to speak to those with an inside knowledge of the company's operations," said Richard Alderman, director of the SFO, in the statement. "It is right for us to look into the UK operations of AIG Financial Products Corp., to determine if there has been criminal conduct." AIG is unwinding the financial products business, which sold derivatives including protection on fixed-income investments and caused about $34 billion in write-downs since 2007. The US government rescued AIG last year to reduce losses at banks that did business with the insurer.

It was a "surprise" for the SFO to disclose the probe so early in the investigation, said David Corker, a lawyer at Corker Binning in London. Usually the agency doesn't make announcements until after conducting searches, he said.