Police question 17 over failed bombing bids

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The latest arrest, following raids at two properties in south London, brings the number of people being held in custody in Britain to 17. Mr Osman is being held in Italy while attempts to extradite him continue. Two of his brothers are also being held in custody in Italy.

Police sources confirmed reports that the raid on the flat in Stockwell, south London on Monday night, was carried out because the address had been given by Mr Osman on official paperwork, despite him living elsewhere. Last Wednesday, police raided a house nearby, where he was reported to have been living with his wife and three children.

Monday night's raid was followed by similar police operations at another address in Stockwell and at a property in Clapham, where another man was arrested.

Sources suggested that the current searches were targeted at people suspected of giving aid and assistance to alleged bombers, rather than those who might have carried out the acts themselves. Police are still questioning three other suspects for the 21 July attacks: Muktar Said Ibrahim, 27, and Ramzi Mohammed, arrested last Friday, and Yasin Hassan Omar, 24, who was arrested in Birmingham.

Italian authorities denied they were trying to hinder British attempts to extradite Mr Osman (whose real name is said to be Hamdi Isaac), despite reports that he was negotiating a deal "to start a new life in Italy" in return for giving evidence on the Italian network that helped him flee Britain.

Mr Osman was arrested in Rome last Friday, after British, French and Italian police tracked his mobile telephone calls across Europe. He is suspected of the Warren Street bombing.

The semi-official Ansa news agency reported yesterday: "Hamdi will stay in Italy'' and security sources quoted by Il Messaggero of Rome said negotiations between Mr Osman and Italian authorities had almost certainly "frozen indefinitely" prospects for extradition.

Mr Osman has been formally charged with terrorism offences in Italy although it remains unclear what effect this, or any negotiations, will have on extradition. Hislawyer, Maria Rosaria Sonnessa, who visited him again in prison yesterday, has warned that the extradition process could be drawn out, even though it is a test case under the new European arrest warrant supposed to expedite cases within the EU, normally within two months.

Judge Franco Ionta, head of the anti-terrorism pool of magistrates in Rome, said Mr Osman would stay in Italian custody "as long as there are investigative needs linked to the issuing of a precautionary arrest warrant".

The main extradition hearing could be as late as September and even if won by Britain, Mr Osman would have a right to appeal to Italy's supreme court.