BEIJING, June 2 (Reuters) - Employees at a Chinese company named by U.S. officials as makers of tainted toothpaste denied on Saturday that it had used a poisonous chemical in its products, reacting to the latest scare about China's consumer goods.

The U.S. Food and Drug Administration issued a warning about Chinese-made toothpaste on Friday after toothpaste containing diethylene glycol was detected in a shipment seized at the border.

"It is not allowed. There are restrictions limiting its use," said an employee at Suzhou City Jinmao Daily Chemicals Co. Ltd., when asked about diethylene glycol (DEG).

The employee, reached by telephone, declined to be named and said he was new at the company and was not too familiar with its exports.

An employee at a second enterprise named by U.S. officials, Goldcredit International Trading Co. Ltd., said the company did not export to the United States but declined to comment further.

The seizure of tainted toothpaste was the most recent in a series of scares over the safety of locally made products, that have put China's food and drug exports under scrutiny around the world.

Similarly contaminated toothpaste has been seized across Latin America, and in Panama, the government says at least 100 people died after taking cough syrup that contained DEG, an industrial solvent used in paint and antifreeze.

U.S. officials said using the affected brands, which include Cooldent, Clean Rite and Oralmax, presented a low risk to human health but that chronic use, particularly among children or those with kidney or liver disease, could be problematic.

Chinese authorities have defended the quality of locally made goods, saying the vast majority of its exports met quality standards.

Wei Chuanzhong, deputy head of the quality and inspection bureau, told a recent news conference that direct responsibility for the Panama cough syrup deaths lay with Panamanian traders, who renamed products and tweaked expiry dates.

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