FBI Busts Missile Smuggling Plot

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A British arms dealer and at least two other men were arrested Tuesday in a yearlong sting operation for selling a surface-to-air missile to undercover federal agents. Sources tell CBS News the dealer was secretly videotaped as he made his sales pitch, bragging about the weapon's ability to bring to down a commercial jetliner.

Federal authorities said Tuesday they arrested three people and foiled an international plot to smuggle into the United States a shoulder-fired missile that could shoot down a commercial airliner.

A British man of Indian descent was arrested in Newark, N.J., after agreeing to sell a sophisticated Russian SA-18 Igla missile to an undercover FBI agent posing as a Muslim extremist, according to a federal law enforcement official who spoke on condition of anonymity.

The arrest occurred Tuesday afternoon at a hotel near Newark International Airport, according to a second federal official. The man had just flown to Newark from London to close the deal, another U.S. official said.

Two other men, believed to be involved in money laundering, were apprehended about the same time at a gem dealership on Fifth Avenue in Manhattan, the second official said.

The arrests were the result of a cooperative investigation involving U.S., British and Russian authorities. More arrests were possible, authorities said.

There are also reports that the arms dealer was involved in a plot to bring down Air Force One. But U.S. officials at the FBI and the Department of Homeland Security strenuously deny that, reports CBS News Correspondent Bob Orr.

Security sources say there was no specific plot against any airliner. But they concede it's very alarming that someone was able to smuggle the lethal weapon into the U.S. and was willing to shop it to would-be terrorists.

The investigation began about five months ago when the Russians passed on to the FBI a tip about the arms dealer that was received in St. Petersburg, Russia, said one law enforcement official. British officials, including the MI5 domestic intelligence agency, helped track the man's whereabouts.

The understanding between the Briton and the undercover FBI agent who agreed to purchase the weapon was that the missile needed to be capable of bringing down a commercial airliner, the first official said.

The missile was provided by Russia and brought to the United States aboard a ship to make the deal seem real — but the weapon was under the supervision of investigators, the official said. It had been rendered inoperable.

The British suspect does not appear to be connected to a known terrorist group. He is thought to be more of an arms dealer or smuggler, the first federal official said.

Authorities stressed that no specific, credible threat was connected to the alleged plot.

None of the arrested men's names or the charges against them were immediately disclosed. Officials said initial appearances for the three were expected Wednesday morning in Newark federal court.

Justice Department officials had no immediate comment on the case, which was under court-ordered seal.

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-Qaida 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.

Chechen rebels have used Igla shoulder-fired missiles against Russian military aircraft. Last week they used a missile to shoot down a Russian helicopter, killing three of the crew. And last year the rebels shot down a Russian troop-carrying helicopter, killing more than 100 people.

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.

Sen. Charles Schumer, D-N.Y., is backing a bill introduced by Sen. Barbara Boxer, D-Calif., that calls for outfitting all of the roughly 6,800 planes in the U.S. commercial fleet with anti-missile defenses. The cost is estimated at $10 billion.

"The danger of an airliner being shot down by one of these missiles is now staring the Homeland Security Department in the face," Schumer said. "The fact that DHS is planning to take at least two years to develop a missile defense prototype to outfit the U.S. commercial fleet verges on the dangerous."

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.

World leaders meeting in Evian, France, in June acknowledged the threat posed by shoulder-fired missiles and adopted a plan to restrict sales of the weapons.