May 28 (Reuters) - A U.S. law firm said it unknowingly

filed fraudulent claims in a $5.6 billion antitrust settlement

with Visa and Mastercard ( MA ), telling a judge it was "embarrassed"

and would strengthen its review process.

The firm, New York-founded Milberg Coleman Bryson Phillips

Grossman, said in a Brooklyn federal court filing on Friday that

it received paperwork from a "referral" source and then

submitted the material to a claims administration company as

part of the process for clients to receive money from the

settlement.

A class of 12 million retailers in the case accused Visa and

Mastercard ( MA ) of improperly fixing credit and debit card fees. The

companies denied any wrongdoing in reaching the settlement,

which a court upheld last year.

Milberg told attorneys for the class that the firm had

withdrawn 30 "proofs of authorization" following an

investigation that began in early May. Milberg was not involved

in negotiating the settlement but represented clients seeking a

piece of the fund.

Milberg and attorneys for the retailer plaintiffs did not

immediately respond to requests for comment on Tuesday. Visa and

Mastercard ( MA ) also did not immediately respond to similar requests.

A judge on Sunday set a June 6 deadline for class counsel

and Milberg to submit more information about the false claims.

U.S. courts have faced mounting questions about false claims

being submitted in multimillion-dollar class action settlements.

Milberg in Friday's court filing said the disputed "claims

somehow slipped through without detection." The firm said in the

filing, jointly submitted with plaintiffs' counsel, that "we are

strengthening our internal audit and review procedures so that

this will not happen again."

Milberg said it was undertaking an audit of every claim it

has submitted to the court. It asked for time to provide the

court "a more complete and detailed analysis of all claims

submitted by the firm."

The firm said it was "fully cooperating" with attorneys for

the class.

Class lawyers said some of the submissions were purportedly

from household name multinational companies and that even a

"cursory" review showed the filings to be fraudulent.

The case is In re Payment Card Interchange Fee and Merchant

Discount Antitrust Litigation, U.S. District Court, Eastern

District of New York, 1:05-md-01720-MKB-VMS.

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