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[MJ]

BELGRADE (Reuters) - Former Yugoslav President Slobodan Milosevic was arrested on Friday, a source close to the Serbian government said.

The development came on the eve of a deadline set by U.S. legislation for President Bush to declare Yugoslavia is cooperating with the U.N. War Crimes Tribunal, which has indicted Milosevic, or impose economic sanctions on Belgrade.

Milosevic was to be transferred to a justice administration building in central Belgrade, the source told Reuters.

``He has been arrested and he should be brought to the palace of justice,'' the source said. Belgrade's B92 radio station also reported the arrest, citing well-informed sources.

A convoy of jeeps, including two with darkened windows, later entered the courthouse building at around 11:30 p.m.

A Reuters reporter said one of the jeeps with darkened windows moved out of reporters' view after entering the building. Local BK television said Milosevic was in one of the vehicles, quoting policemen at the scene.

One source close to the government said he was suspected of several crimes, including abuse of office.

But an official in Milosevic's Socialist party denied he had been arrested. ``I am right here with him. This is nonsense,'' Socialist Party vice president Zivorad Igic told Belgrade's B92 radio by telephone.

However Igic refused the radio presenter's request to put Milosevic himself on the telephone to prove he was still free.

Opposition leader Vuk Draskovic from the Serbian Renewqal Movement told BBC Television: ``That's very clear -- Milosevic is arrested. I don't know what is the charge. But anyway he is responsible for many, many terrible things.''

Earlier on Friday, a police van, an ambulance and several unmarked cars showed up near the former Yugoslav president's home, sparking speculation that his arrest was imminent.

Deputies of Milosevic's Socialist party rushed to their leader's home in the exclusive Dedinje district of Belgrade to join a band of his supporters after they informed parliament that the vehicles had arrived.

Yugoslavia's new reformist rulers have said the former leader will not be arrested on war crimes charges before the U.S. deadline.

But they have left open the possibility that local justice authorities might order his arrest for alleged offences such as corruption.

A spokesman for the U.N. war crimes tribunal in the Hague, Jim Landale, told Reuters on hearing the reports of Milosevic's arrest: ``Our position is exactly the same as it has always been.

``Yugoslavia has a legal obligation under international law to transfer all fugitives on their territory, of which we believe there is a substantial number.

``If Milosevic is in custody, that can only make that international legal obligation easier to fulfil. We expect him to be transferred to the tribunal at the earliest possible opportunity.''

[ March 30, 2001: Message edited by: MJ ]

[MJ]

By south-east Europe analyst Gabriel Partos
Allegations that former Yugoslav President Slobodan Milosevic smuggled more than $1m of gold abroad last year are part of a wide range of claims that have been made against the former Serbian strongman whose arrest may not be far away.

One of the first moves of the newly-elected post-Milosevic authorities in Serbia was to place Mr Milosevic under 24-hour surveillance at the end of January.

At the time this was presented as being partly inspired by the need to protect Mr Milosevic from his enemies or potential bounty hunters keen to collect the $5m reward offered by the United States Government for delivering the ex-leader to the war crimes tribunal in The Hague.

Since then the surveillance has turned increasingly into a form of informal custody as various criminal charges against Mr Milosevic are being looked at.

However, investigators may not find it easy to gather the required evidence.

Mr Milosevic was adept at issuing orders verbally - in person, on the phone and even indirectly - so that there may be little written evidence around that could prove his guilt.

The charges are:

Gold smuggling - A Belgrade prosecutor has asked police to investigate claims that Mr Milosevic's associates moved 173 kg of gold to Switzerland between September and November last year - around the time of Mr Milosevic's fall from power.
The gold, worth $1.1m, was then sold, and the proceeds were apparently paid into bank accounts in Greece and Cyprus, the two favoured destinations for illicit money transfers from Serbia since the time of the UN sanctions on Belgrade during the period of the Bosnian war.

The implication is that Mr Milosevic may have removed state funds from Serbia for his own private use.


False claims over property - Mr Milosevic has been accused of making false claims about the extent of his assets to secure for himself a luxurious government villa.
If the ex-leader were to be found guilty of forging documents to conceal his assets, he could be sentenced to up to three years' imprisonment.


Assassinations - The former secret police chief, Rade Markovic, was arrested last week amidst charges that his organisation was involved in the attempted assassination of the prominent opposition leader, Vuk Draskovic, in an apparent road accident in 1999.

Four of Mr Draskovic's associates were killed in the incident which involved a truck plunging into Mr Draskovic's convoy of cars.

The killing in 1999 of newspaper publisher Slavko Curuvija, a one-time ally who had turned against Mr Milosevic, has also been blamed on the secret police - which could implicate Mr Milosevic himself.


Abduction - Former Yugoslav President Ivan Stambolic was kidnapped in August last year while out jogging.


Rade Markovic is suspected of being behind assassinations and kidnaps

No evidence has come to light so far as to who was behind the abduction of Mr Stambolic who had become a bitter critic of the Milosevic regime.

But Mr Stambolic's friends have been pointing an accusing finger at the secret police.


Election fraud - Following the Yugoslav presidential election in September, the Federal Electoral Commission tried to deprive Vojislav Kostunica of victory by claiming that he received less than the required 50% of the votes cast.
Five members of the commission are now facing trial for the falsification of results - and the matter could be extended to the municipal elections at the end of 1996 when the Electoral Commission annulled opposition victories in a number of Serbian cities.

The chain of command behind the ballot rigging could well lead to Mr Milosevic.


War crimes - While investigators in Serbia are gathering evidence against Mr Milosevic in the run-up to a possible indictment in the future, The Hague Tribunal says it could start a trial any time on the basis of an indictment it issued against Mr Milosevic nearly two years ago for war crimes allegedly committed in Kosovo.
The Serbian authorities are reluctant to extradite the former leader, partly on the grounds that such a move could provoke political unrest.

However, the latest opinion poll suggests that the majority of Serbs (56% against 31%) would be willing to see their former leader tried in The Hague.

[MJ]

It appears that the news about Slobo's arrest might've been exaggerated.