FBI Is Investigating If $100,000 In Checks From New Jersey Man Funded Terrorism

The Federal Bureau of Investigation said it is looking into whether a New
Jersey man taken into custody after Sept. 11 may have helped fund terrorist
activities with a series of unusual financial transactions.

The suspect, Mohammad Aslam Pervez, was formally charged last week with
lying to FBI agents about checks totaling more than $100,000. Mr. Pervez
has been the focus of intense scrutiny since authorities connected him to
two men with whom he roomed in Jersey City. All three men were employed by
the same newsstand owner, Usman Bandukra, with whom Mr. Pervez exchanged
many of his suspect checks.

The two other men, Ayub Ali Khan and Mohamad Azmath, were pulled off an
Amtrak train and arrested in Fort Worth, Texas, on Sept. 12 with boxcutter
knives, more than $5,000 in cash and multiple passports. The two had
boarded the train in St. Louis after their TWA flight from Newark to San
Antonio was grounded on Sept. 11 following the terrorist attacks.

Wednesday, new details emerged about the arrests of Mr. Khan and Mr.
Azmath. They were pulled off the train because Amtrak authorities and the
Drug Enforcement Administration suspected that they might be drug
traffickers, according to DEA officials in Fort Worth. Karina Van Veen, an
Amtrak spokeswoman, confirmed that the rail line had tipped off authorities
in Fort Worth that the men were aboard. A DEA official in Fort Worth said a
routine database check revealed that the name "Ayub Khan" was similar to a
known heroin smuggler from Pakistan. The DEA said the two men bore earmarks
of traffickers: For example, they had one-way tickets from St. Louis to San
Antonio that they bought with cash at the last minute.

Mr. Khan turned out not to be the smuggler, and a check of the men's
belongings turned up no drugs. But it did turn up the boxcutters, passports
and hair dye. A DEA agent in Fort Worth said routine questioning of the two
yielded conflicting statements: Mr. Azmath said he was going to San Antonio
for a month, while Mr. Khan said he was going there for only a week.

When the passports were found, DEA officials called in the Immigration and
Naturalization Service, which took the two into custody on visa violations.
An official of the Indian Embassy said Wednesday that the two had reported
their passports missing earlier this year and got new ones in Hydrabad,
India, where they are from. They have been charged by Indian authorities
with passport fraud.

Mr. Khan and Mr. Azmath are being held as material witnesses in New York.
The FBI and Justice Department have declined to comment on why they are
being held. Lawyers for the two couldn't be located for comment.

A spokeswoman for the FBI confirmed the investigation into whether
financial dealings of their former roommate, Mr. Pervez, were being used to
fund terrorism. "That's what we're investigating," said FBI spokeswoman
Sandra Carroll, though she added that no link has yet been found.

The FBI has tested items removed from the three men's Jersey City apartment
for anthrax; the results aren't yet known. Magazines -- addressed to Mr.
Khan, saved for six years, and bearing cover stories about biological and
chemical warfare -- were left in the Jersey City apartment.

Many of the checks that Mr. Pervez is accused of lying about were exchanged
with Mr. Bandukra, with whom he appears to have had a closer relationship
than previously revealed. The lease for Mr. Pervez's apartment was
co-signed by Mr. Bandukra. Mr. Pervez worked at a newsstand owned by Mr.
Bandukra at the Trenton train station between 1996 and 1998 and later
worked with Mr. Khan and Mr. Azmath at Mr. Bandukra's Newark train-station
newsstand. A second apartment, in Trenton, was also secured by Mr.
Bandukra, and the phone for that address is listed in Mr. Pervez's name.

Richard Gruber, an attorney for Mr. Bandukra, said he wasn't surprised that
the FBI was examining whether his client's transactions with Mr. Pervez
funded terrorist activities. But he said the money flowing back and forth
between the two was a business transaction involving Mr. Pervez's
investment in a Trenton newsstand that Mr. Bandukra was buying. Both Mr.
Bandukra and the attorney for Mr. Pervez, Charles Lavine, declined to comment.

In India, family members of Mr. Khan and Mr. Azmath said they hadn't heard
from them, don't know where they are being held and don't know if they have
lawyers. Both families denied that the men are connected to the Sept. 11
attacks or their aftermath. "There's no news about him at all. We don't
know who to contact or where to contact," Mehrun Nissa, Mr. Khan's
mother-in-law, said in an interview in Hyderabad. She said Mr. Khan
telephoned his wife on Sept. 10 and said he and Mr. Azmath were moving to
Texas to work at a fruit company.

When FBI agents interviewed the family several weeks ago in India, they
asked about that phone call and whether Mr. Khan "loved or hated the United
States," Mrs. Nissa said.

Separately, a 55-year-old Pakistani man detained in connection with the
terrorism investigation died in custody of an apparent heart attack
Tuesday. The inmate, identified by the Pakistani Embassy as Muhammad Rafiq
Butt, had been held at the Hudson County Correctional Facility in Kearny,
N.J. The Immigration and Nationalization Service said in a statement that
Mr. Butt was taken into custody Sept. 19 and interviewed by the FBI. The
FBI later determined it had no further interest in him, but he was being
held on an alleged immigration violation.

- -- Rasul Bailay in New Delhi and Ann Davis in New York contributed to this
article.