Calling it "an incredible triumph for the war against terrorism," federal prosecutors Wednesday accused three men of plotting to sell 50 anti-aircraft missiles to an FBI informant posing as a terrorist.
"This morning the terrorists who threaten Americans lost an ally in their quest to kill our citizens," said Christopher J. Christie, the U.S. Attorney for New Jersey, as he announced the charges against "three men who were prepared, for money, to allow Americans to be threatened and perhaps killed."
Hemant Lakhani, a man of Indian descent, was arrested at a hotel near the Newark International Airport on Tuesday with a sophisticated Russian SA-18 Igla missile, which had been rendered inoperative by Russian agents.
Lakhani, 68, was charged with aiding terrorists by attempting to import a missile "specifically for the purpose of shooting an American commercial airliner out of the sky," Christie said.
If operable, the missile would have been accurate to a range of three miles.
According to an FBI affidavit filed to support the charges, Lakhani also asked for a commitment from the Russian "suppliers" — actually undercover Russian agents — for 50 more missiles to be sent to the United States by Aug. 30 and also said he was interested in purchasing a ton of C-4 plastic explosive.
The Muslim extremist who wanted the missile actually was an FBI informant.
Lakhani was ordered held without bail by U.S. Magistrate Judge Susan D. Wigenton pending a custody hearing Monday. Lakhani's lawyer refused to comment on the case after the hearing.
Two other men were apprehended Tuesday at a gem dealership on Fifth Avenue in New York City, where agents could be seen carting out files from a downtown office building.
One of those men, Moinuddeen Ahmed Hameed, was also ordered held without bail pending a hearing on Aug. 20 on charges of conspiring to operate an unlicensed money transmitting business.
Officials also announced charges against the third man, Yehuda Abraham, who was to be arraigned in federal court in Manhattan on Wednesday on money laundering charges.
According to Christie, the men were arrested the day the sample missile was to be delivered in exchange for $500,000 — a 10 percent down payment on the 50 other missiles.
Abraham, Christie said, accepted an initial $30,000 down payment on behalf of Lakhani, and presumably got it overseas to accounts controlled by Lakhani, while Hameed was only recently brought into the plot to help launder the expected $500,000.
Lakhani, Christie said, "knew full well" that the sale would lead to targeting American citizens and the economy. He said there were indications Lakhani was a "significant international arms dealer," but would not elaborate. He said the other two defendants also knew the nature of the deal they were helping to facilitate.
Authorities stressed that there was no specific, credible threat to shoot down an airliner in the United States.
Officials say Lakhani is not a terrorist, and not affiliated with al Qaeda. But sources tell CBS News Correspondent Bob Orr the government has the dealer on secretly recorded videotape bragging about the weapon's ability to shoot down planes.
"There was no question that Mr. Lakhani was someone who was sympathetic to the beliefs of the terrorists who are trying to do damage to our country," Christie said, saying Lakhani had referred to Americans as "bastards" and Osama bin Laden as a "hero."
The arrests followed a yearlong undercover operation. Christie said the plot originated in New Jersey, but did not give details.
The probe included agents from the FBI, the Department of Homeland Security and British and Russian authorities. The investigation also involved the Bureau of Immigration and Customs Enforcement and the Secret Service.
The Russians passed on their tip about the reputed arms dealer's activities to the FBI, which was permitted to work inside Russia, U.S. officials said. British officials, including the MI5 domestic intelligence agency, helped track the man's whereabouts.
Concerns about terrorists using shoulder-fired missiles to shoot down commercial airliners increased in November when two SA-7 missiles narrowly missed an Israeli passenger jet after it took off from Mombasa, Kenya. Officials concluded that al Qaeda probably was behind the attack, which coincided with a bomb blast at a nearby hotel.
Hundreds and perhaps thousands of shoulder-fired missiles — heat-seeking rockets that can hit low-flying aircraft within three miles — are said to be available on the worldwide arms market. Older missile launchers can be bought for as little as several thousand dollars.
The Homeland Security Department has asked U.S. high-tech companies to look into developing anti-missile technology for commercial planes. Critics in Congress say the agency is not moving quickly enough or spending enough on the project.
Meantime, the United States has sent experts to domestic airports as well as to airports in Iraq and major capitals in Europe and Asia to assess security. The investigators are trying to determine whether the airports can be defended against shoulder-fired missiles.
© 2003 CBS Interactive Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.