A former Nazi who fled to South America and became the charismatic leader of a religious sect has been arrested in Argentina on charges of child abuse and torture.

Paul Schaefer, 83, was seized in the town of Tortuguitas, 18 miles west of Buenos Aires, along with six people described as his security team, Argentine police said.

He has been hiding for eight years, ever since a warrant for his arrest on paedophile charges was issued in Chile in August 1996. He was convicted in his absence in November 2004 along with 22 other cult members.

A former corporal and medic in Hitler's army, Mr Schaefer fled Germany to Chile in 1961 to avoid child sexual abuse charges in his homeland.

He founded a self-sufficient German enclave called Colonia Dignidad, in the mountains 200 miles south of the Chilean capital, Santiago.

Surrounded by barricades, barbed wire and electric fences, he and his flock of German immigrants adhered to a strict discipline and remained cut off from the rest of Chilean life.

But the secrets of life in the remote community started to spill out in 1996, when a number of former residents testified that Mr Schaefer systematically abused the colony’s young children, many of whom were taken from the parents at birth.

The Chilean authorities also want to question Mr Schaefer in connection with torture during the rule of the right-wing dicatator President Augusto Pinochet, between 1973 and 1990.

Investigators say that a number of political prisoners, including Alvaro Vallejos Villagran, a former leftist leader who was arrested by Pinochet agents in May 1974, vanished after being sent to Colonia Dignidad.

A former member of Pinochet’s secret police has given evidence that he knew Senor Vallejos Villagran was taken alive to Dignidad.

Police also want to question Mr Schaefer about the disappearance of Boris Weisfeiler, an American Jewish mathematics professor of Russian origin, in 1985.

Investigators believe that Mr Weisfeiler was picked up by a military border patrol while he was backpacking in the region on suspicion of being a spy, and dropped off at Dignidad.

Mr Weisfeiler’s sister Olga said that there were reports by Dignidad residents of seeing him alive up to two years later.

The Argentine Police Commissioner, Alejandro Dinisio, said that Mr Schaefer carried no identification documents and refused to speak at the time of his arrest. He added that police had been on his trail for six months.

To accelerate Mr Schaefer’s arrival to face justice, the Chilean interior minister has asked his Argentine counterpart to kick him out of Argentina immediately, to avoid going to court to ask for an extradition, which could delay the case with appeals.

Argentine television reporters mobbed Mr Schaefer as an agent pushed the elderly suspect in his wheelchair into a provincial police station. Officials said that he could be transferred to Buenos Aires today. He appeared on television, handcuffed and smiling, and holding a bottle of fizzy drink.

The arrest "was good reason for which we are all happy," said President Ricardo Lagos of Chile.

Joschka Fischer, the German Foreign Minister, hailed the arrest as good news. "His arrest will allow a comprehensive investigation into all the criminal activities in the former Colonia Dignidad to be carried out and punishments to be handed down," Herr Fischer said.

"The Chilean and German authorities have charged Schaefer with serious crimes, including false imprisonment and sexual abuse of minors."

Colonia Dignidad still exists, but has been renamed Villa Baviera in a bid to shake off its past. Around 300 people, mainly Germans, still live there.

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