Updated at 5:23 p.m. ET: Libya's national assembly on Sunday elected a former congressman and diplomat as the country's new prime minister.

Ali Zidan, who resigned as a congressman to run as a candidate in the election, won 93 votes, securing him a majority from those present in voting.

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Zidan was a diplomat under Moammar Gadhafi before defecting in the 1980s and joining Libya's oldest opposition movement, National Front for the Salvation of Libya, from Geneva where he resided.

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The 200-member General National Congress selected the new prime minister following last week's dismissal of Mustafa Abushagur after just 25 days in the post for failing to form a government acceptable to the national assembly. Zidan had previously run against Abushagur and lost.

Minister for local government, Mohammed Al-Harari, came in second place with 85 votes.

Zidan told a news conference he would focus on restoring security to Libya.

"The security file will be my top most priority because all the problems that Libya suffers from stems from security issues. The government will be an emergency government to solve the crises that the country is going through," he said.

Zidan, who had support from the leading liberal coalition, the National Forces Alliance, also suggested, however, that he was ready to take into account the views of the Islamist Muslim Brotherhood in his government.

"Islam is our belief system and the source for any jurisprudence, and anything against sharia is refused," he said.

Gadhafi kept Libya broadly secular, but the uprising which toppled him has paved the way for the emergence of both Islamist and more secular factions, as well as opening up tribal and regional divisions in the North African country.

The Associated Press and Reuters contributed to this report.

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A human rights organization says it has collected evidence of two previously unreported cases in which U.S. agents used waterboarding or a similar harsh interrogation technique on Libyan militants held by American forces in Afghanistan. 

The 154-page report by Human Rights Watch also paints a more complete picture of Washington's close cooperation with the regime of Libya's former dictator Moammar Gadhafi in the wake of the 9/11 attacks. The U.S. handed over to Libya the Islamist opponents of Gadhafi that it detained abroad with only thin "diplomatic assurances" that they would not be mistreated, and several of them were subsequently tortured in prison, Human Rights Watch said. 

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The report features interviews by the New York-based group with 14 Libyan dissident exiles. They describe systematic abuses while they were held in U.S.-led detention centers in Afghanistan -- some for as long as two years -- or in U.S.-led interrogations in Pakistan, Morocco, Thailand, Sudan and elsewhere before the Americans handed them over to Libya.

"Not only did the U.S. deliver his (Gadhafi's) enemies on a silver platter, but it seems the CIA tortured many of them first," said Laura Pitter, counterterrorism adviser at Human Rights Watch and author of the report. 

"The scope of Bush administration abuse appears far broader than previously acknowledged and underscores the importance of opening up a full-scale inquiry into what happened," she added. 

UK spies to face criminal inquiry over Libya

The documents, which were found in once-secret archives that became public during the Libyan revolution, included classified correspondence between top Libyan officials and officials from the CIA and Britain's spy agencies MI5 and MI6. 

They illustrate how, between late 2003 when Gadhafi agreed to give up his weapons of mass destruction programs, and the 2011 Libyan revolution, Gadhafi and Western intelligence agencies quietly cooperated in battling Islamic militants. 

Waterboarding is a form of simulated drowning that President Barack Obama and human rights activists have condemned as torture. 

Britain, U.S. defend actions
U.S. and British officials defended their governments' actions. 

"It can't come as a surprise that the Central Intelligence Agency works with foreign governments to help protect our country from terrorism and other deadly threats. That is exactly what we are expected to do," said Jennifer Youngblood, a CIA spokeswoman. 

"The context here is worth revisiting. For example, by 2004, the U.S. government had convinced Gadhafi to renounce Libya's WMD programs and to help stop those terrorists who were actively targeting Americans," Youngblood said. 

A spokesman for Britain's Foreign Office said: "The government has been clear that it stands firmly against torture and cruel, inhuman and degrading treatment or punishment. We do not condone it, nor do we ask others to do it on our behalf. 

"In addition, we have published the Consolidated Guidance which provides clear directions for intelligence officers and service personnel dealing with foreign liaison services regarding detainees held overseas," the spokesman said. 

Slideshow: Moammar Gadhafi through the years 

Some of the other nations that Human Rights Watch alleged to be U.S. collaborators in these operations are the Netherlands, Pakistan, China, Malaysia, Morocco and Sudan. 

The most dramatic, and potentially controversial, of the report's 14 case studies relates to alleged waterboarding. 

Human Rights Watch said that testimony from former detainee Mohammed Shoroeiya about how he was allegedly waterboarded repeatedly by U.S. interrogators was "detailed and credible."

Shoroeiya claimed he had been waterboarded while in U.S. custody in Afghanistan, and that a doctor was present during the interrogation sessions, the group said. 

It said that a second former Libyan detainee, Khalid al-Sharif, described how he was subjected to a "similar type of treatment," though this did not involve being strapped to a board. 

Libyan rebels find album filled with photos of his 'darling' Condoleezza Rice

Human Rights Watch said both detainees claimed that they were hooded and had ice water poured over their noses and mouths until they felt like they were suffocating -- the sensation associated with waterboarding. 

Claims contradict Bush, CIA
The accounts by the Libyan detainees, one-time members of a militant faction called the Libyan Islamist Fighting Group, contradict claims by former President George W. Bush, former CIA director Michael Hayden and other U.S. officials that waterboarding was only used on three militants in the wake of the September 11, 2001, attacks -- none of them Libyan. 

U.S. officials expressed skepticism about the waterboarding allegations. And there are apparent differences in how the Libyans describe their treatment and the waterboarding procedures used in three cases that U.S. authorities have confirmed -- those of alleged al-Qaida militants Abu Zubaydah, Khalid Sheikh Mohammed and Abd al-Rahim al-Nashiri. 

In those cases, official investigations reported, the interrogation subjects were doused repeatedly, but in short bursts, with bottled water. 

Slideshow: Life goes on in Guantanamo

"The agency has been on the record that there are three substantiated cases in which detainees were subjected to the waterboarding technique," the CIA's Youngblood said. 

"Although we cannot comment on these specific allegations, the Department of Justice has exhaustively reviewed the treatment of more than 100 detainees in the post-9/11 period -- including allegations involving unauthorized interrogation techniques — and it declined prosecution in every case," she added. 

Reuters and The Associated Press contributed to this report.

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TRIPOLI - Tunisia has extradited former Libyan leader Moammar Gadhafi's prime minister to Libya, a Libyan security official said on Sunday, making him the first senior official to be sent back for trial under the country's transitional leadership. 

Defense ministry official Mohammed al-Ahwal told Reuters that a helicopter transferred Al Baghdadi Ali al-Mahmoudi to Tripoli on Sunday. 

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"Mahmoudi is now in Tripoli and we are holding him in a prison," Ahwal said. 

Mahmoudi served as the Libyan dictator's prime minister from 2006 until he fled to neighboring Tunisia around the time that rebel fighters took the capital Tripoli in August. 

Libya begins battle to seize $20 billion in Gadhafi assets - starting with London mansion

His extradition could establish a precedent for other countries who have given refuge to or arrested members of Gadhafi's old entourage. 

Tripoli considers it a matter of national pride and a measure of the country's transformation that trials of people like Mahmoudi and Gadhafi's imprisoned son Saif al-Islam be held in Libya. 

But human rights groups question whether its justice system can meet the standards of international law and say he should be handed over to the ICC instead. 

A Tunisian court ruled as far back as November that Mahmoudi should be extradited. But Tunisian President Moncef al-Marzouki later said the handover would not happen until the situation in Libya had stabilized and Mahmoudi could be guaranteed a fair trial after Gadhafi himself was killed by rebels and his rotting corpse left on display. 

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TRIPOLI -- Representatives of the International Criminal Court arrived in Tripoli on Sunday to try to secure the release of a detained delegation visiting Moammar Gadhafi's captured son, a Libyan official said. 

The four-member delegation was being held by a militia group in the western mountain town of Zintan after one of its lawyers, Australian Melinda Taylor, was found carrying documents regarded as suspicious for Seif al-Islam Gadhafi, a Libyan lawyer and a militia member told Reuters on Saturday.

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The president of the international war-crimes court demanded their immediate release. 

"An (ICC) delegation arrived [Sunday] in Tripoli. They are holding meetings with officials about this," said the Libyan official, without giving further details. 

'Total confusion': Libyan militia surrounds, cuts off Tripoli airport

Seif al-Islam is at the center of a wrangle between the international court and the new government in Tripoli, both of which have drawn up plans to prosecute him for alleged war crimes. 

Under international law, a country has the first right to try suspects for crimes committed on its own soil. But the ICC indicted Seif al-Islam before the fall of his father's regime and cannot drop his case until it is convinced that Libya's new government will prosecute him for the same crimes -- and that it is capable of giving him a fair trial. 

Death of Lockerbie bomber al-Megrahi 'doesn't close the book'

Reflecting Libya's wider problem of powerful local militias and a weak central government, the Zintan brigade holding Seif al-Islam said it would not heed the government's request to release the four ICC staff before questioning them. 

"They are still under investigation," a member of the brigade said. "The visiting delegation won't see them just yet." 

The ICC has previously expressed concern at the conditions under which he is being held. Human rights groups also question whether Libya's justice system can meet the standards of international law. 

A Libyan lawyer said the suspicious documents included letters from Seif al-Islam's former right-hand man Mohammed Ismail, as well as blank documents signed by the prisoner. 

Police: No foul play in drowning of former Libyan minister

The international court said the 36-year old Taylor has been working at the ICC since 2006 as counsel in the office that represents ICC indictees' interests before the appointment of a formal defense counsel. 

The ICC named the three other staff members as Helene Assaf, an ICC translator and interpreter since 2005; Esteban Peralta Losilla, the chief of the Counsel Support Section at the ICC; and Alexander Khodakov, a Russian career diplomat who is the external relations and cooperation senior adviser at the registry of the ICC. 

Reuters and The Associated Press contributed to this report. 

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NEW YORK -- The death of the only man convicted in the 1988 Lockerbie bombing has left some victims' relatives relieved and others raising questions about his guilt and whether others went unpunished.

Abdel Baset al-Megrahi, a former Libyan intelligence official, died Sunday of cancer, his family said. His death renewed pleas from some victims' relatives for further investigation of the bombing.

"It closes a chapter but it doesn't close the book. We know he wasn't the only person involved," Frank Dugan, president of the group Victims of Pan Am Flight 103, said from Alexandria, Va.

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Al-Megrahi was convicted of blowing up Pan Am Flight 103 over the Scottish town of Lockerbie on Dec. 21, 1988. The bombing killed 270 people, including 189 Americans. Syracuse University in central New York was particularly hard hit: 35 students on the way home for Christmas break died in the bombing.

$2.7 billion in compensation
Libyan ruler Moammar Gadhafi handed over al-Megrahi and a second suspect to Scottish authorities after years of punishing U.N. sanctions. In 2003, Gadhafi acknowledged responsibility, though not guilt, for the bombing and paid compensation of about $2.7 billion to victims' families.

Some relatives attended al-Megrahi's trial in the Netherlands. When he was released to Libya from a Scottish prison in 2009 on humanitarian grounds — he was supposedly close to death — they were outraged when al-Megrahi returned to a hero's welcome from Gadhafi and then lived far longer than the few months the doctors had predicted.

Susan Cohen of Cape May Court House, N.J., whose daughter was among the Syracuse University students on the flight, said al-Megrahi deserved no compassion.

"The fact that he was able to get out and live with his family these past few years is an appalling miscarriage of justice. There was no excuse for that," Cohen said Sunday. "He should have died in the Scottish prison. He should have been tried in the United States and faced capital punishment."

The views of other victims' families on al-Megrahi's role in the bombing vary widely.

"Megrahi is the 271st victim of Lockerbie," said David Ben-Ayreah, who represents some British families of victims. He attended the trial and still believes al-Megrahi was not responsible for the bombing.

'Very happy'
But Eileen Walsh, a Glen Rock, N.J., resident whose father, brother and sister died in the explosion, said she was "very happy" to hear about al-Megrahi's death. She had just attended Mass on Sunday when she received numerous text messages.

"I'm glad he's gone, but there's no real closure. There's nothing but a bad taste in my mouth," she said.

"My mother died of cancer in 2004, and because of him, three of the most important people in her life weren't there to help her in her time of need," Walsh said.

Al-Megrahi was found guilty under Scottish law of secretly loading a suitcase bomb onto a plane at Malta's Luqa Airport, where he was head of operations for Libyan Arab Airlines in December 1988.

The suitcase was transferred at Frankfurt to another flight and then onto New York-bound Pan Am Flight 103 at London's Heathrow airport, concluded Scottish judges sitting at a converted Dutch military base selected as a neutral trial venue.

Al-Megrahi, who was handed over by Gadhafi under a U.N.-brokered deal, always insisted he was merely an airline executive, not a Libyan intelligence agent as prosecutors charged.

Miscarriage of justice?
Al-Megrahi's co-defendant was acquitted of all charges. Al-Megrahi insisted he also had nothing to do with the bombing. Those who believed him got a boost in 2007 when a three-year investigation by a Scottish tribunal found that new evidence — and old evidence withheld from trial — suggested that al-Megrahi "may have suffered a miscarriage of justice." Its 800-page report prompted an appeal on al-Megrahi's behalf, but by then his fate was in the hands of politicians in London, Tripoli and Edinburgh, all of whom jockeyed for position as Libya rebuilt its ties with Britain and al-Megrahi's health deteriorated.

Still protesting his innocence, al-Megrahi dropped the appeal in a bid to clear the path for his release on compassionate grounds. 

Al-Megrahi's death should not be an excuse to stop trying to find out who was behind the bombing, Cohen said. She called on U.S. and British officials to "dig even deeper" into the case.

The Scottish government said Sunday that it will continue investigating the Lockerbie bombing.

U.K. Prime Minister David Cameron, visiting the United States on Sunday, said that al-Megrahi should never have been freed.

However, Britain's ITV News reported that Cameron dismissed calls for a new inquiry into al-Megrahi's conviction, saying the court case was "properly run and properly dealt with."

Read more coverage from Britain's ITV News

Bert Ammerman of River Vale, N.J., lost his brother in the bombing. He blames the U.S. and Britain for failing to track all leads in the case and noted that Gadhafi's former spy chief was arrested in March in Mauritania.

"He holds the key to what actually took place in Pan Am 103," Ammerman said. "He knows what other individuals were involved and, more importantly, what other countries were involved."

After Gadhafi's fall, Britain asked Libya's new rulers to help fully investigate but they put off any probe.

"Ironically, 24 years later, I now have more confidence in the new Libyan government than the British or American governments to find the truth because I believe Libya would like the truth to come out to show that they were not the only country involved," Ammerman said.

Jim Swire, whose 19-year-old daughter, Flora, died in the bombing, is a leading voice for some of the British families who believe al-Megrahi was innocent. Swire, who attended the trial in the Netherlands, asked for further inquiry from the Scottish government.

''I've been satisfied for some years that this man had nothing to do with the murder of my daughter and I grit my teeth every time I hear newscasters say 'Lockerbie bomber has died,'" Swire told the BBC on Sunday. ''This is a sad day."

'Smelled of a deal for oil'
Al-Megrahi's brother Mohammed told Reuters that a funeral would take place on Monday.

"My brother was surrounded by his wife, children and his mother as he took his last breath. He was too sick to utter anything on his deathbed," his brother Abdulhakim added. "We will always tell the world that my brother was innocent."

Senator Charles Schumer of New York, who wanted the Libyan government that took over after Gadhafi's ouster and killing by rebels to take al-Megrahi into custody, said his return to Libya was a major injustice.

"The whole deal smelled of a deal for oil for this man's freedom and that was almost blasphemy given what a horrible person he was and the terrible destruction and tragedy that he caused," Schumer said. "I don't know if we'll ever get to the bottom of it now."

Msnbc.com staff, ITV News, The Associated Press and Reuters contributed to this report.

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Libya's former prime minister and oil minister Shukri Ghanem, a prominent defector from Moammar Gadhafi's government, drowned in the River Danube, Vienna police said on Monday, but a Libyan security source suggested he could have been murdered.

Ghanem's fully-clothed body was found in the Danube in Vienna on Sunday, a few hundred yards from his home. According to a preliminary autopsy there were no indications of foul play or suicide, spokesman Roman Hahslinger told reporters.

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A Libyan security source said they were investigating the death and believed he could have been pushed into the Danube by former Gadhafi agents.

Former Libyan oil minister found floating in Danube

His body was found at 8:40 a.m. on Sunday by a passerby near the entertainment area known as Copa Cagrana, where a footpath winds along the riverbank. He had spent Saturday evening watching television with his daughter.

The daughter noticed at around 10 a.m. that her father was no longer at home, police said.

The former Gadhafi confidant, who was also close to Gadhafi's son Saif al-Islam, was privy to potentially damaging information on oil deals with Western governments.

Ghanem, 69, had been chairman of Libya's state-owned National Oil Corporation (NOC) before defecting last year several months after opponents of Gadhafi had risen up against the Libyan leader and begun a rebellion.

Saad Djebbar, a UK-based Algerian lawyer who knew Ghanem and advised the Libyan government during the Lockerbie affair, told Reuters Ghanem was not the sort of man to kill himself. "It's a very mysterious death," he said.

"He was worried about the future course of politics in Libya but he would not be the kind of man for suicide. He was very well introduced internationally and had lots of connections.".

"Shokri Ghanem definitely is one of the guys who knew a lot and was one of the most powerful guys in the old regime," said David Bachmann, an Austrian Chamber of Commerce official based in Tripoli who knew Ghanem well.

As NOC chairman since 2006, Ghanem helped steer Libya's oil policy and held the high-profile job of representing Libya at OPEC meetings, often visiting Vienna for meetings in that role.

After making a final break with the Gadhafi administration last year, Ghanem first appeared in Rome, saying he had defected because of the "unbearable violence" being used by government forces to try to put down the rebellion.

He had been working of late as an energy consultant in Vienna, where two daughters and their families also live.

Hahsinger said police had been unaware of any "concrete" threats against Ghanem.

Ghanem was still closely associated with Gadhafi's rule by Libya's new leaders and had ruled out returning home.

"Definitely there were people there who did not like him or who thought that he had stolen billions and now he is in safety in Vienna, having a nice life," Bachmann said, adding it was common knowledge that Ghanem was often in Vienna.

Bachmann said he would not have been surprised to read that former Libyan rebels had taken revenge on Ghanem, but said Gadhafi allies could also have held a grudge.

"The problem was he was sitting between the chairs. For the old guys (in the Gadhafi regime) he was a defector, a kind of a rat. For the rebels he was also a rat because he did not defect early enough," Bachmann said.

A woman who answered the phone at his home in a high-rise apartment block and identified herself as his daughter said: "Today we are still in a state of shock...right now I'm sorry I can't talk more."

Bachmann said Ghanem had many friends in Austria and Italy and spent time shuttling between Vienna and Rome while trying to lead a quiet life.

"He was 69 and was not a stupid guy. You figure out you have no political future and at a certain moment you say 'OK, let's finish this Libya story and try to enjoy my family and my grandkids and that's it'."

Ghanem, who studied at the Fletcher School of Law and Diplomacy in Boston in the early 1970s, stood out among his fellow graduate students for his sharp intellect and infectious humor.

While American students there worried about soaring petrol prices during the OPEC oil embargo of 1973, he eagerly explained and defended the Arab view of the emerging new world energy order.

At an alumni reunion in 2004, he impressed his former classmates with his insider's account of the economic reforms he planned to introduce with the help of Gadhafi's son Saif al-Islam, whom he had mentored at OPEC headquarters at a time when the now-captured son wanted to make a name for himself outside of Libya.

Ghanem said Saif al-Islam had persuaded his father to reform but he wasn't sure how far reforms could go. He said he only wanted to stay in office as long as he could modernize the economy. If Gadhafi didn't keep him, Ghanem said, he would happily retire to write one or two books on economics he had in mind.

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A Canadian citizen being held in a Mexican jail on suspicion of attempting to help members of the Gadhafi family out of Libya as the Libyan regime was crumbling says she's been set up and called on her government to speak out.

"I've lost a lot," Cynthia Vanier told CBC. "My family suffered, as have all our families."

Vanier has been locked up in a prison in Chetumel, along the border with Belize, for five months, charged with helping finance planes, obtaining fake passports and attempting to smuggle members of the Gadhafi family out of Libya.

One of Moammar Gadhafi's sons, Saadi, managed to escape to Niger after his father was toppled. Vanier denies she ever met Saadi.

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The woman showed CBC signed contracts for work in Libya through a partnership between her company, Vanier Consulting, and Canadian engineering and construction firm SNC-Lavalin, which had construction projects underway in Libya before the Gadhafi regime fell. She says her company was hired for fact finding, consulting work, arranging planes and planning how to move employees back to Libya once the conflict died down. 

Vanier was arrested in November while she was in Mexico setting up a water meeting for SNC-Lavalin. She says prosecutors tried her in the media before she was even charged.

In a meeting with President Barrack Obama and Canada's Prime Minister Stephen Harper in Washington last week, Mexican President Felipe Calderon called Vanier's arrest a success.

"Ive been basically accused of being a criminal by the leader of this country when I haven't gone through the process yet," Vanier told CBC. "So how can Canada sit back and say it's OK?"

Vanier is appealing her charges and awaiting trial.

Gadhafi was killed in an Oct. 20 fight between his supporters and rebels in the town of Sirte, where he was born and which was a stronghold of his supporters.

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Libyans have been taking to beaches once reserved for slain dictator Moammar Gadhafi, amid hopes that the war-ravaged country could build a tourist industry.

The country has the longest stretch of coastline on the Mediterranean Sea with hundreds of miles of largely deserted beaches.

Could sun-soaked Libya become a tourism hot spot?

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Attracting overseas tourists may prove problematic with some ongoing fighting between rival groups.

Militias have clashed in Zuwara, western Libya, in recent days, killing at least 18 people.

However an army official told Reuters Thursday that the two groups had stopped fighting after government troops imposed a ceasefire.

Reuters reporters in the town said there was no sign of fighting Thursday, in marked contrast to the day before when mortars and rockets were kicking up plumes of smoke, and the town hospital was over-flowing with the wounded.

Reuters contributed to this report.

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The arrest of Moammar Gadhafi's ex-spy chief, Abdullah al-Senussi, in Mauritania has set off a three-way tussle for his extradition.

Libya has formally requested that Mauritania hand over Senussi, who arrived there Saturday on an overnight flight.

But Senussi, who for decades before the late dictator's fall inspired fear and hatred in ordinary Libyans, also is sought by the Hague-based International Criminal Court on charges of crimes against humanity during last year's conflict.

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And France -- confirming it played a role in his arrest -- stressed his alleged role in the 1989 bombing of an airliner over Niger in which 54 French nationals died.

"Today we confirm the news of the arrest of Abdullah al-Senussi," Libyan government spokesman Nasser al-Manee told a news conference in Tripoli.

"He was arrested this morning in Nouakchott airport and there was a young man with him. We think it is his son," he said, confirming a Mauritanian state news agency report that Senussi had been arrested with a false Malian passport arriving from Casablanca, Morocco.

France, which led Western backing for the popular uprising that toppled Gaddafi, said it had cooperated with Mauritanian authorities over the arrest and that it would be sending an arrest warrant to Mauritania.

A statement from President Nicolas Sarkozy's office noted Senussi had been sentenced in absentia for the 1989 bombing of a UTA airliner, in which 170 people were killed. Families of the victims immediately demanded he face justice in France.

An ICC spokesman said an ICC arrest warrant for Senussi also remained valid and requested that it be implemented.

But Libya's National Transitional Council was adamant.

"We insist that Senussi is extradited to Libya," NTC spokesman Mohammed al-Harizy said. "There are demands from the ICC and France to get Senussi, but the priority is to deliver Senussi to Libya."

While Mauritania is not a signatory to the Rome Statute governing the ICC, rights groups Human Rights Watch and Amnesty International both said Mauritania was bound by the U.N. Security Council to fully cooperate with the ICC.

Hassiba Hadj Sahraoui, Amnesty International Deputy Director for the Middle East and North Africa, said in a statement that the Libyan justice system in any case "remains weak and unable to conduct effective investigations into alleged crimes."

Britain, along with France one of the key Western backers of the insurgency, also cited the need for Mauritania to cooperate with the ICC in a statement attributed to Foreign Secretary William Hague.

Msnbc.com staff contributed to this report from Reuters.

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French President Nicolas Sarkozy has denied that former Libyan dictator Moammar Gadhafi gave his 2007 presidential campaign $65 million, the Financial Times reported.

The French investigative site Mediapart reported Monday that it found a document showing that after Sarkozy connected with Gadhafi through a notorious Libyan businessman, he received transfers from Swiss and Panamanian bank accounts. Mediapart was co-founded in 2008 by one of France’s most well-known investigative reporters.

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Last year, Gadhafi’s son, Saif al-Islam, made a similar allegation during an interview with the Euronews TV Channel, the Guardian reported. Al-Islam, frustrated that Sarkozy supported the opposition to his father's regime, threatened to divulge the details of bank transfers to Sarkozy's campaign.

The Financial Times reported that the document had not been proven to be authentic.

Sarkozy’s opponent in this race, François Hollande, has demanded that Sarkozy explain the document, the Guardian reported.

“Well then the son should just go ahead and produce them,” Sarkozy said on French television, according to the Financial Times.

The businessman, Ziad Takieedine, also denied the allegations.

“There was not one bit of any finance from Libya to France or from Gadhafi to Sarkozy. Nothing,” Takieedine said.

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TRIPOLI - Supporters of ousted Libyan leader Moammar Gadhafi seized control of the town of Bani Walid on Monday after clashes with a militia loyal to the new government in which four people were killed, witnesses told Reuters.

The violence was bad enough that authorities in Tripoli felt forced to dispatch dozens of revolutionary fighters to Bani Walid, the Guardian reported, quoting brigade commander Saddam Abdel-Zein.

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A resident of Bani Walid, about 120 miles south-east of Tripoli, said the sides fought using heavy weaponry, including 106 mm anti-tank weapons, and that 20 people were wounded.

Another witness told Reuters the fighting had now stopped but that Gadhafi loyalists were in control of the town center, where they were flying green flags, a symbol of allegiance to the ousted administration.

• Libya could fall into 'bottomless pit', leader warns

"They control the town now. They are roaming the town," said the witness, a fighter with the 28th May militia which was fighting the Gadhafi loyalists.

Bani Walid, base of the powerful Warfallah tribe, was one of the last towns in Libya to surrender to the anti-Gadhafi rebellion last year. Many people there oppose the country's new leadership.

The uprising in Bani Walid could not come at a worse time for the ruling National Transitional Council (NTC). It is already reeling from violent protests in the eastern city of Benghazi and the resignation of its second most senior official.

• Militias may drag Libya into civil war

An air force official told Reuters that jets were being mobilized to fly to Bani Walid. In Tripoli, there were signs of security being tightened, Reuters reporters in the city said.  

Fighters "massacred"
The violence in Bani Walid was sparked when members of the May 28 militia arrested some Gadhafi loyalists.

That prompted other supporters of the former leader, who was captured and killed in October, to attack the militia's garrison in the town, said the resident, who spoke on condition of anonymity.

"They massacred men at the doors of the militia headquarters," said the resident.

During Libya's nine-month civil war, anti-Gadhafi rebels fought for months to take Bani Walid.

Local tribal elders eventually agreed to let NTC fighters enter the town, but relations have been uneasy since and there have been occasional flare-ups of violence.

In November last year, several people were killed in Bani Walid when a militia group from Tripoli's Souq al-Juma district arrived in the town to try to arrest some local men.

Taking back control of the town will be challenging because it has natural defenses. Anyone approaching from the north has to descend into a deep valley and then climb up the other side, giving defenders an advantage.

It was this landscape, in part, that prevented anti-Gadhafi militias from taking the town during the civil war, despite the fact they were heavily armed and had superior numbers.

Reuters and msnbc.com staff contributed to this report.

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International inspectors have confirmed that late Libyan dictator Moammar Gadhafi had an undeclared stockpile of chemical weapons, the organization that oversees a global ban on such armaments announced Friday.

The Organization for the Prohibition of Chemical Weapons said inspectors who visited Libya this week found sulfur mustard and artillery shells "which they determined are chemical munitions," meaning the shells were not filled with chemicals, but were designed specifically to be loaded with chemical weapons.

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"They are not ready to use, because they are not loaded with agents," OPCW spokesman Michael Luhan said.

He would not divulge the amounts of chemicals in the previously unknown stockpile, except to call it "a fraction" of what Gadhafi disclosed in the past.

Libya's new rulers told the Hague-based organization about the chemicals last year after toppling Gadhafi from power. The longtime Libyan strongman was killed in October after being captured by rebel fighters.

The newly confirmed chemical armaments are stored at the Ruwagha depot in southeastern Libya together with chemical weapons that Gadhafi had declared to international authorities in 2004 as he tried to shake off his image as an international pariah and rebuild relations with the West.

He declared his regime had 27.6 tons of sulfur mustard and 1,543 tons of precursor chemicals used to make chemical weapons. His regime also declared more than 3,500 unfilled aerial bombs designed for use with chemical warfare agents such as sulfur mustard, and three chemical weapons production facilities.

Those stockpiles were being destroyed until a technical problem halted destruction last year at the same time as the popular uprising began that led to Gadhafi's ouster and death.

Libya was to have completed destruction of its chemical weapons by April 29 of this year, under the terms of an international treaty, but can no longer meet the deadline after the turmoil that roiled the country last year. The country's new government now has until that date to file a plan and proposed completion date for destroying its entire chemical weapon stockpile.

The BBC reported that other countries were also behind  in meeting the terms of the international treaty. It said the US has acknowledged it will take as long as 2021 to finish destroying the final 10 percent of its chemical weapons. Russia is farther behind in its effort, having destroyed only about 48 percent of a large cache of chemical weapons, the OPCW has said.

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The Associated Press and msnbc.com staff contributed to this report.