'Prince of Marbella' walks free: A Syrian multi-millionaire accused of financing the hijacking of the 'Achille Lauro' has been released from jail in Spain on record bail, writes Phil Davison, in Madrid

STAFF at his rambling Mediterranean palace, described by past guests as something out of A Thousand and One Nights, prepared a special welcome of Arab delicacies and much champagne. After a somewhat uncomfortable absence, 'The Prince of Marbella' was coming home.

The 'prince', known thus as a result of his luxurious lifestyle, is a multi-millionaire Syrian arms dealer, Monzer al-Kassar, 47, who left the Alcala-Meco prison near Madrid last night after more than a year in detention. Mr Kassar was not exactly free. He was being released on a record Spanish bail of around pounds 10m.

Linked in past media reports with the Lockerbie bombing, Mr Kassar faces no such charges here. He is, however, accused of being the financier of Abul Abbas's extremist Palestine Liberation Front (PLF), to have financed and helped deliver the arms used in the 1985 hijack of the Achille Lauro cruise ship and to have abetted the 1984 Madrid shooting of a Lebanese, Elias Awad, suspected by the PLF to have been an Israeli Mossad agent.

Also pending are a string of lesser accusations, drawn up by an investigating Spanish magistrate, ranging from illegal possession of firearms to using false passports and running a network of stolen luxury cars.

He denies all the accusations that led then magistrate Baltasar Garzon to order his preventive detention in June last year. Before this week's unexpected National (High) Court decision to allow him out on conditional liberty, he had been expected to be charged with most, if not all the accusations. Now, though he is not supposed to leave Spain, some judicial sources here cast considerable doubt that he will be charged or tried.

Mr Garzon was named by Prime Minister Felipe Gonzalez yesterday as Spain's anti-narcotics tsar, a new job aimed at combatting the rising tide of hard drugs into this country. Privately, Mr Garzon told friends he had been stunned by the decision of a three-man National Court tribunal to free the Syrian on bail. The same tribunal had only two weeks earlier prolonged Mr Kassar's preventive detention until June next year.

Mr Kassar made world headlines in 1989 when a Democratic US congressman, James Traficant, claimed the Syrian had been involved in the Lockerbie bombing. The congressman produced a documented report which suggested the CIA had allowed Mr Kassar to run a heroin-shipping network into the US in return for information on American hostages in Lebanon. Unknown to both the CIA and Mr Kassar, the report suggested, Palestinian guerrilla leader Ahmed Jibril got wind of the operation and had supporters switch the lethal timebomb suitcase for one containing drugs that went on PanAm flight 103 in December 1988.

Mr Kassar, the report went on, found out about the bomb in advance and tipped off US authorities, but nothing was done.

The report was later widely discredited as an attempt to muddy the waters of the Lockerbie investigation and Mr Kassar denied any involvement.

According to Mr Garzon, however, the evidence linking the Syrian with the Achille Lauro hijacking was strong. The then magistrate visited Italy several times to interview the jailed Palestinian hijackers and said they had identified Mr Kassar 'with 100 per cent certainty' as the man who gave them the AK-47 rifles and other weapons they used.

Another Arab witness against Mr Kassar, one of his former aides known as Abu Merced and still in preventive detention in Spain, described the Syrian as the PLF's financier and said the weapons had been obtained by Mr Kassar in Warsaw.

After another witness in the al-Kassar case, his former cook, Ismail Jalid, was found dead after falling from the fourth floor of a building last September, Abu Merced withdrew his testimony against Mr Kassar. Mr Jalid's death, which looked at first sight like suicide, was later treated as murder, still unsolved. There has never been any official suggestion that Mr Kassar was involved in Jalid's death.

Diplomatic sources here say Mr Kassar's connections with various intelligence services around the world may have helped him win release on bail. Despite the fact that he has been detained, wanted or deported from several countries including Britain he has been able to move around the world freely in recent years.

Evidence given to the US Irangate hearings said the CIA had paid Mr Kassar dollars 1.5m ( pounds 1m) for helping get arms to the Nicaraguan Contra rebels.

Mr Kassar set up home in Marbella in the early Eighties. His protectors, according to diplomats who were involved in the case, were Spanish police, intelligence and government officials. That protection was given as a quid pro quo to France, whom Mr Kassar was said to have helped win the release of French hostages from Lebanon.

Spain owed the French the favour for cracking down on Basque Eta terrorists in southern France and allowing a shadowy Spanish organisation known as GAL to hunt down the terrorists. GAL was later found to have involved senior Spanish police officers, two of whom were jailed for 108 years each.

Although Mr Kassar was deported from Spain in 1987 as 'a threat to internal security', he resurfaced here soon afterwards, apparently with the protection of senior authorities, and was often to be seen in the casino at the posh resort of Puerto Banus, outside Marbella.