Londoner held over Pakistan kidnap

A former London public schoolboy suspected of being one of Osama bin Laden's key operatives was under arrest today after an FBI police swoop on a hideout in the eastern Pakistani city of Lahore.

Ahmed Omar Saeed Sheikh, 28, son of a prosperous East End clothing merchant, is suspected of masterminding the kidnap of American reporter Daniel Pearl who vanished in Karachi three weeks ago, and of having transferred £70,000 to Mohammed Atta, before the latter led the 11 September hijackings.

A joint FBI-Pakistani police team raided his hideout after being given the location by a suspect arrested in the capital, Islamabad, last night. Sheikh was today being transported in an armoured convoy to Karachi.

Mr Pearl, 38, disappeared after trying to investigate a group linked to British-born Richard Reid, accused of trying to blow up a US airliner.

Sheikh was a star pupil at the Forest school in Snaresbrook and then studied at the London School of Economics, where he was drawn into a circle of militant Islamic fundamentalists. He later underwent terrorist training at a camp in Afghanistan used by Bin Laden's Al Qaeda network.

He served five years in prison for luring three British tourists and an American into a kidnap trap in 1994, but was released after the hijack of an Air India jet.

FBI agents stepped up the hunt for Sheikh after analysis of emails sent by Mr Pearl's captors betrayed electronic " fingerprints " indicating his involvement. They suspect Sheikh was using kidnap to further the cause of an Islamic group fighting in Kashmir.

There was still no news of Mr Pearl's fate.