Feb. 6 (Bloomberg) -- Documents former Treasury Secretary Paul O'Neill gave to an author who used them to write a critical book on President George W. Bush contained classified information, the current secretary, John Snow said in a letter to Congress obtained by Bloomberg News.

O'Neill, who was fired by the president in December 2002, was the main source for the book, ``The Price of Loyalty,'' written by Pulitzer Prize winner Ron Suskind. He gave Suskind 19,000 documents that crossed his desk during his 23 months at the department and which were given to him on his request months after his departure from government.

Those documents ``were not properly reviewed'' by the Treasury before they were given to O'Neill, Snow said in the letter to about a dozen congressional committees.

``In recent weeks, Treasury personnel have conducted a systematic review of the documents released to Mr. O'Neill,'' Snow wrote. ``We have identified a number of documents that contain classified information, and we are taking corrective action concerning those documents.''

Snow, attending a meeting in Florida of finance ministers from the Group of Seven industrial nations, was not immediately available for comment.

A Treasury official who declined to be identified said no action would be taken against O'Neill or Suskind and that the department was focusing on improving its handling of classified material.

`Nothing Wrong'

Suskind said in an interview that the Treasury officials told him he and O'Neill had done ``nothing wrong.'' His lawyers and the government had been in conversation in recent days ``over documents they feel should have been classified, but were not marked classified,'' he said.

The author declined to say which materials had concerned the Treasury. They were not among the papers Suskind published on his Web site, and he said he had no plans to release them, as he had with other materials O'Neill gave him.

Suskind also declined to comment on whether he felt the inquiry was part of an administration effort to discredit him and O'Neill. O'Neill did not immediately return a phone call request for comment.

Snow had asked Treasury's inspector general, Jeffrey Rush, to investigate whether CBS's use of a report stamped ``Secret'' in a program about O'Neill and the book compromised government security.

Number One

Treasury spokeswoman Anne Womack Kolton said: ``weaknesses in the handling and safeguarding (of Treasury documents) were brought to the attention of Secretary Snow'' by Rush. The investigation is continuing, she said.

The book, which reached No. 1 on Amazon.com's bestseller list, accuses Bush of being disengaged and uninterested in policy and claims his administration began planning to oust Saddam Hussein from the Iraqi presidency within weeks of taking office in Jan. 2001.

Democratic U.S. Representative Charles Rangel of New York said in a statement that while the Bush administration has ``gone through all of this trouble to see if they can find something that Secretary O'Neill did wrong, they have not contradicted the accuracy of his account.''

In interviews following publication of the book, Suskind has said that none of the documents that the Treasury passed to O'Neill were marked ``classified,'' and O'Neill has said that all the documents he had been given and passed on to Suskind had been cleared by the Treasury's top lawyer. A CBS spokesman has said its actions were proper.

To contact the reporter on this story: Michael McKee at mmckee@bloomberg.net, or Vincent Del Giudice at vdelgiudice@bloomberg.net

Last Updated: February 6, 2004 19:32 EST