Prosecutors investigating possible false accounting at Italy's Volare are set to question the grounded airline's managers, including those who left this year to set up rival Myair.com.

Volare, which runs Italy's best-known no-frills airline, is seeking insolvency status, having last week suspended all flights in a move that shocked its 1,400 employees and left thousands of passengers stranded.

"Over the next few days, we'll question all the managers, executives, everyone who formed part of management during the period in question," said Mr Antonio Pizzi, chief investigating magistrate in Busto Arsizio, outside Milan.

He said yesterday he had received a report by forensic accountants KPMG, part of a probe into false accounting and embezzlement at Italy's third-largest airline.

"We are confiscating all the relevant documents, the accounts of the last 10 years, the company's books and administrative records," he added.

Volare has long been struggling under heavy losses and debt and, last week, its planes were grounded altogether. Sources close to Volare said it suspended the flights after losing its insurer.

On Monday, police raided its offices as part of an investigation into its accounts begun the previous week.