A senior United Nations official who used his influence to steer contracts worth more than $50 million to a man who rewarded him with valuable real estate was arrested Wednesday, prosecutors said.

Sanjaya Bahel, of Manhattan, was charged in an indictment unsealed in U.S. District Court.

Bahel, a former Indian official, and chief of the commodity procurement section of the U.N.'s Procurement Division until 2003, is chief of the Commercial Activities Service in the U.N. Postal Administration. He has been suspended without pay since August.

Bahel, 55, was accused of accepting city real estate as a reward to assist Nishan Kohli in getting contracts. Kohli was arrested Wednesday in Miami.

Bahel was formally charged said U.N. spokesman Stephane Dujarric.

According to the indictment, Bahel, beginning in at least 2000, used his influence as a senior procurement officer to benefit Kohli and the companies he represented. Bahel granted exceptional access to Kohli, including a line of communication and a source for information within the United Nations that exceeded what other U.N. vendors received, U.S. Attorney Michael J. Garcia said in a statement.

Bahel even canceled bids by competing companies and rebid contracts to make sure Kohli and his business interests had a competitive advantage, Garcia said.

Both men, charged with bribery, were scheduled to make their first court appearances on Thursday. They each could face up to 10 years in prison if convicted.

Prosecutors said they did not know who was representing the men. A telephone message left at Bahel's home was not immediately returned Wednesday night. No phone listing could immediately be found for Kohli, whose companies are based overseas.

Earlier this year, a U.N. investigation concluded that Bahel, formally an official in the Indian government when he was working for the U.N. under contract, used his relationship with a wealthy Indian businessman and his son to steer deals to the company they represented.

Bahel was formally charged with misconduct by the United Nations on Aug. 31 and has been suspended without pay since that time. At the request of U.S. authorities, U.N. Secretary-General Kofi Annan agreed to have Bahel's diplomatic immunity waived Wednesday.

When asked about the report's findings by The Associated Press two months ago, Bahel vehemently denied the claims.

"To me, the allegations are not correct," he said then. "I have good reasoning and valid reasoning to counter those."

The U.N. report said Bahel had a longtime relationship with the Kohlis, who were on the guest list for his son's 2002 wedding. It also said that in 2003, Bahel rented two side-by-side New York apartments from them at rates well below the market and later bought the apartments, where he now lives, at a favorable price.