A SUSPECTED terrorist mastermind with close links to the July 21 and liquid-bomb plotters is being secretly held under house arrest at his home in north London.

The suspect – who because of a court gagging order can be referred to only as AY – has been placed under a strict control order by a High Court judge on the recommendation of MI5.

The man, a British national, was served with the control order last week after security officials decided he was too dangerous to be allowed his liberty. He has been told by a judge that the order was granted because Jacqui Smith, the home secretary, believes he is involved in terrorist-related activities.

AY is banned from using the phone or the internet to communicate. Only a small number of family and friends are allowed to visit him.

British officials claim he has held meetings with Mohammed al-Ghabra, a suspected Al-Qaeda operative who is believed by MI5 to have played an important role in the events before the failed Tube and bus bombings of July 21, 2005.

Al-Ghabra, a naturalised British citizen who was born in Syria but lives in Forest Gate, east London, has been accused by both the United States and Britain of being a banker for Al-Qaeda.

The US Treasury said it believed Al-Ghabra had “organised travel to Pakistan for individuals seeking to meet senior Al-Qaeda individuals and to undertake jihad training”.

Al-Ghabra denies having any links to terrorism. He told The Sunday Times last year: “If I am a money-maker and this is why they have decided to put the sanctions against me, how could I have so many financial problems myself?”

MI5 concerns have been compounded by evidence that AY is also a close associate of seven men who face retrial over the so-called liquid-bomb plot, after a jury failed to reach a verdict last week.

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