FALLUJAH, Nov 10: US-led troops occupied most of Fallujah on Wednesday and aimed to take full control within 48 hours, as kidnappers threatened to kill members of Iraqi Prime Minister Iyad Allawi's extended family unless the assault was stopped.

As the military noose tightened around more than two-thirds of the city, seen as the epicentre of resistance, Iraqi troops claimed they had found homes inside Fallujah where foreign hostages had been held and in some cases slaughtered.

In northern Iraq, scores of militants swooped on the city of Mosul and set up positions, aiming mortars and rockets at key US installations, as local police watched on helplessly. At least five people were killed in the city.

Violence also raged elsewhere, with six Iraqi guards and a US soldier killed in a string of roadside bombings.

With US marines backed by Iraqi troops moving from building to building in Fallujah to free the dusty, devastated city of guerillas, a US official said they expected to take command of the militant bastion before the weekend.

"If everything goes as planned we will take full control of the city in the next 48 hours," the official said.

He added that the troops would still need up to a week to make the northeastern corner of Fallujah safe "and at least 10 days to clear the city". "For now we are clearing pockets of resistance."

Signs of the killings of hostages were found by Iraqi troops in the northern districts, according to an Iraqi general who called himself the chief spokesman for the operation.

"We have found hostage slaughterhouses in Fallujah that were used by these people and the black clothing that they used to wear to identify themselves, hundreds of CDs and whole records with names," Major General Abdul Qader Mohan told reporters.

After weeks of heavy US aerial and artillery bombardment, thousands of marines and Iraqi troops stormed Fallujah on Monday in an assault dubbed Operation Dawn.

Mr Allawi has vowed to crush the resistance before elections planned for January, to provide greater security and wider participation in them, and sees the fight for Fallujah as key to achieving this goal.

KIDNAPPING: But the tough-talking premier's own family became caught up in the mayhem after a gang in three cars abducted his cousin, Ghazi Allawi, and the latter's daughter on Tuesday night.

It was unclear whether the wife of his cousin, a businessman not involved in politics, had also been kidnapped.

But a previously unknown group threatened to kill three Allawi family members within 48 hours unless he halts the attack and releases all Iraqi prisoners, in an Internet statement impossible to authenticate. They were taken from a house in southern Baghdad.

"This act will not bend the will of the government to fight terrorism," Mr Allawi's spokesman said.

At least 11 US soldiers and two Iraqi troops have died since the Fallujah offensive was launched, while scores of guerillas have also been killed, the US military said.

No civilian casualty figures have been made available. British Prime Minister Tony Blair urged the US-led forces to stand firm.

"The real desire of these terrorists is to stop the elections because they know that if there are elections in Iraq, as there have been in Afghanistan, then that is a huge blow to them as terrorists," he told parliament in London.

In an effort to persuade the last pockets of resistance in the fiercely independent city to lay down their arms, Mr Allawi offered an amnesty to those who had "committed no major crimes".-AFP

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