Swiss authorities have held Yevgeny Adamov, the Russian former nuclear energy minister, after Washington charged him with diverting $9m (£4.7m) from US funds to improve Russian nuclear security.
Mr Adamov, a nuclear physicist, was arrested at the request of US authorities while he was visiting Berne, Folco Galli, a justice ministry spokesman said. He is accused of siphoning the money to US firms he controls or to investments.
The former minister was wanted by US authorities for fraud and money-laundering, Mr Galli said. A warrant was issued by the US district court in Pennsylvania. Mr Galli said Mr Adamov travelled to Switzerland to see his daughter, but refused to comment on a New York Times report that he was trying to negotiate with Swiss officials about his daughter's bank accounts which had been blocked.
Russia's foreign ministry said its consular officials in Berne were still trying to meet Mr Adamov. Moscow said the charges were unconnected to his tenure in its government.
Mr Adamov had run the Dollezhal Institute, a government organisation in Moscow that developed nuclear weapons and reactors. He was appointed minister by President Boris Yeltsin in 1998. He returned to the institute after he was fired by President Vladimir Putin three years later, facing corruption claims.
In 2001, a Russian government committee accused him off illegally setting up companies in and out of Russia, including a consulting firm, Omeka, in Monroeville, Pennsylvania.
Swiss authorities are asking Mr Adamov whether he is willing to accept simplified extradition to the US. If he refuses, Washington will have to file a formal request. Extradition could take six months.
While Mr Adamov was a minister, he angrily rebuffed US objections to Russia building a nuclear reactor in Iran.