By Phil Stewart

WASHINGTON | Thu Feb 24, 2011 3:37pm EST

WASHINGTON (Reuters) - The military said on Thursday it will investigate accusations that a psychological operations unit was used in Afghanistan to try to persuade visiting senators to increase war funding.

The accusations were made in a Rolling Stone magazine article quoting the leader of the Army unit, Lieutenant Colonel Michael Holmes, who objected to what he saw as an illegal use of his team's skills on American citizens.

"I'm prohibited from doing that to our own people. When you ask me to try to use these skills on senators and congressman, you're crossing a line," Holmes was quoted as saying.

The article said the unit was ordered by Lieutenant General William Caldwell, a three-star commander in charge of training Afghan troops, to target visiting dignitaries.

These included senators John McCain and Carl Levin -- the top Republican and Democratic members of the Senate Armed Services Committee -- and Admiral Mike Mullen, chairman of the U.S. military's Joint Chiefs of Staff.

Rolling Stone quoted a statement from Caldwell's spokesman as saying the general "categorically denies the assertion that the command used an Information Operations Cell to influence distinguished visitors."

But the NATO-led mission in Afghanistan did not issue a denial on Thursday. Neither did the Pentagon. Instead, it said U.S. General David Petraeus, the top U.S. and NATO commander in Afghanistan, will order an investigation "to determine the facts and circumstances surrounding the issue."

"It would be inappropriate to comment any further at this time," the statement said.

The Rolling Stone article did not detail what if any inappropriate steps were taken to influence high-level visitors nor did it speculate what potential impact they had.

"PRESSURE POINTS"

The article said Holmes' "information operations" unit was repeatedly pressured to target VIPs who met Caldwell over a four-month period in 2010.

Caldwell has sought to further expand his training operation. U.S. officials say he hopes to boost Afghan security forces to up to 378,000 from this year's goal of 305,000, a move that would bolster their ability to battle the Taliban.

The Obama administration, under pressure to rein the gaping U.S. budget deficit, is debating whether it can afford to sustain an Afghan army of that size.

"When the unit resisted the order, arguing that it violated U.S. laws ... it was subjected to a campaign of retaliation," the article said, pointing to a subsequent reprimand against Holmes' for non-related personal conduct.

The term "psychological operations" draws images of subliminal messaging or mind control. But Rolling Stone said the activities the unit was tasked with were "seemingly innocuous" and including compiling profiles, voting records, and "likes and dislikes" of VIP visitors.