DENPASAR (AFP) - An American man has confessed to killing his girlfriend's mother at a luxury resort on the Indonesian island of Bali, while the girlfriend has admitted helping stuff the body into a suitcase, police said Friday.

The battered body of Sheila von Wiese Mack, 62, was found in the case in the boot of a taxi in front of an exclusive hotel in the upscale Nusa Dua resort area on August 12.

Her teenage daughter, Heather Mack, and daughter's boyfriend, Tommy Schaefer, had been staying with her at the St Regis hotel but fled to another part of the island after the killing. They were caught the following day.

They are in custody in Bali while police investigate and could face the death penalty if found guilty of premeditated murder.

Indonesian authorities previously claimed they have strong evidence against the pair and on Friday Djoko Heru Utomo, police chief in the Balinese capital Denpasar, said they had admitted their involvement in the case during questioning in recent days.

"Both suspects have confessed," he said, adding that Schaefer, 21, had admitted to carrying out the killing after an argument with the victim.

The daughter, 19, claimed she watched Schaefer kill her mother and then helped to stuff the body into the suitcase, said Utomo.

"The interrogation is continuing in order to get the full account," he added.

Heather Mack, who is pregnant, had previously refused to talk to Indonesian police without American legal representation present, and this week her lawyer from the United States arrived in Bali to assist her locally-hired lawyers.

The pair are yet to be charged with any crime, as under the Indonesian legal system suspects are not formally charged until they appear in court at the start of a trial.

A trial will only begin once police have completed their investigations and passed the evidence to prosecutors. The victim and the suspects are all from the Chicago area.