An international arms dealer allegedly trying to smuggle shoulder-fired missiles into the United States was arraigned in Federal court Wednesday in Newark, New Jersey. Federal officials say Hemant Lakhani believed he was dealing with a terrorist group that intended to shoot down an American commercial airliner.

A Federal judge ordered Mr. Lakhani, a British national of Indian descent, held without bail until a custody hearing next week. He is charged with aiding terrorists by attempting to import a shoulder-fired missile into the United States for sale to a terrorist group.

In order to complete the undercover operation, U.S. Attorney Christopher Christie says a disabled missile - a dud - was allowed into the United States as a sample. He says Mr. Lakhani told witness that they should order another 50 missiles to make the deal worthwhile. Mr. Lakhani and two other men were arrested Tuesday when an initial down payment was supposed to take place.

Christopher Christie

Mr. Christie called the arrest an important triumph in the war on terrorism. "There is no question that Mr. Lakhani was someone who was sympathetic to the terrorists who were trying to do damage to our country," said the federal prosecutor. "He referred to Americans as bastards, to Osama bin Laden as a hero and who knew full well that the arms dealing was to kill American citizens and to try to shake the stability of our American economy."

The arrests follow an 18-month-long sting operation conducted by the FBI and British and Russian agents. Mr. Christie had particular praise for the Russians, who were able to identify someone who had acquired a surface-to-air weapon in Russia and was trying to sell it abroad.

"This could not have been accomplished without the help of the Russian government, which played an indispensable role in making sure that the plans of these terrorists were never followed through," said Mr. Christie.

A second defendant, Moinuddeen Ahmed Hameed, is also being held without bail until a hearing next week. He is charged with conspiring to operate an unlicensed money-transfer business. Officials say he arrived from Malaysia earlier this week as part of the larger plot to bring in another 50 missiles.

A third man, Yehuda Abraham, a New York jeweler, was arraigned in federal hearing in New York, and ordered transfer to the federal court in New Jersey. Officials say he is charged with money laundering.

U.S. law enforcement officials say the investigation will continue in Britain, Russia and the United States.