Greek police retreat after ambush by Cretan drug gangsters

The ambush was not wholly unexpected. More than 40 armed police officers arrived at the Cretan mountain village of Zoniana in a convoy of a dozen vehicles. But even they were shocked by the force of the response as at least 20 gunmen opened fire on them with Kalashnikov assault rifles before they could pass the first houses in the village.

The one-sided gun battle lasted a matter of minutes as the police who had come searching for drugs withdrew with three officers wounded, one seriously.

What the firefight has achieved is the lifting of a veil of silence surrounding Zoniana that appears to have been at the centre of a lawless mini-republic controlling orchards of cannabis plants, drug dealing, protection rackets and armed robbery from a mountain base among the olive trees and the shepherds.

Crete has long been famed for its independent streak. It has the highest gun ownership rates in the European Union and even a high profile weapons amnesty, led by the composer Mikis Theodorakis, who was born on the island, has failed to end Cretans' love affair with guns.

However, the lax attitude to law enforcement and the culture of non-co-operation with the state appears to have spawned a criminal enterprise in the mountains that the rest of the island can no longer tolerate.

Last week, the Greek Prime Minister Costas Karamanlis was forced to give assurances in parliament that the law does apply even above sea level in Crete: "We will no longer tolerate behaviour outside the law – the law applies to everyone and will be enforced for everyone," he said.

The ferocity of the ambush on the local police unit prompted authorities to fly in 75 officers from an elite unit in Athens who have succeeded where none of their colleagues had previously by maintaining a presence inside Zoniana for six consecutive days. Despite being home to more than 1,600 residents, neither Zoniana or any of the other villages – all within an hour's drive of the tourist resort of Rethymnon – has a police station. The bullet-ridden signposts that mark the entry and exit to the village make it clear that the law is not welcome.

By the time the main force of police arrived at the village on 7 November, up to 200 local males had disappeared and hundreds of hectares of cannabis plants had been removed from earth among the olive orchards where police sources say they were located to make use of the natural camouflage.

So far, 14 arrests have been made and a torrent of evidence from stolen cash machines to explosives has emerged to reveal the extraordinary lives led by many of the villagers.

A local man who claimed to police that he was a shepherd was found to have more than ¿1.5m (£1m) in his account. Local media claim the initial raid was prompted by the arrest of a man from Zoniana who was picked up driving a new Porsche and stated his profession as builder. Unconfirmed reports stated that the unnamed man had up to ¿6m in the bank.

On Friday, police were confronted by angry local men in who demanded the police presence be removed from the village immediately. A school has been closed until the police withdraw.