'Hezbollah treasurer' Barakat arrested in Brazil border city

The US has shown concern about Hezbollah financial operations in South America

Police in Brazil have arrested a man accused by the United States of being one of the main financial operators of the Lebanese militant group, Hezbollah.

Assad Ahmad Barakat was detained near the border with Paraguay and Argentina.

He is wanted for identity theft in Paraguay, where he previously served six years in prison for tax evasion.

The police in Argentina have accused Barakat of laundering $10m (£7.6m) on behalf of Hezbollah at a casino in the Iguazu Falls area.

Barakat, a Lebanese national, was detained in the Brazilian city of Foz do Iguaçu.

'Global terrorist'

The US has long expressed concern about Islamist activities among the sizeable Arab community in the region, known as the Triple Frontier.

The area attracts tourists from all over the world, who travel to see the waterfalls and the luxuriant tropical forest.

But it also has a reputation as a centre for large-scale smuggling and drug-trafficking.

In 2006, the US Treasury Department described Barakat as a "global terrorist" and included his name on a list of people in the Triple Frontier area who helped finance Hezbollah.

Thousands of Brazilian bargain hunters cross daily from Foz do Iguaçu to Ciudad del Este in Paraguay

He was one of nine people and two companies who had their assets frozen.

"Assad Ahmad Barakat's network in the Tri-Border Area is a major financial artery to Hezbollah in Lebanon," said Adam Szubin, who was then director of the US Treasury's Office of Foreign Assets Control.

Brazilian Federal Police said in a statement that he had continued to operate in Argentina, Brazil and Chile after his release from prison in Paraguay in 2008.

It is not clear whether he is going to be extradited to Paraguay or will face charges in Brazil.