MUMBAI ATTACK: FATHER AND SON HELD

The two were arrested in a raid in Brescia, where they managed a money transfer agency, police in the northern Italian city said.

The day before the attacks began on November 26 they allegedly sent money using a stolen identity to a US company to activate internet phone accounts used by the attackers and their handlers, said Stefano Fonsi, the head of anti-terror police in Brescia.

The transfer was just 229 dollars (£138) but gave the attackers five lines over the internet, which are difficult to trace and allowed militants to keep in touch even during the rampage, Mr Fonsi said.

Italian police began the probe in December after being alerted by the FBI and Indian police about the transfer, Mr Fonsi told The Associated Press.

Ten militants, allegedly from Pakistan, killed 166 people in a three-day assault on luxury hotels, a Jewish centre and other sites in India's financial capital. One Italian was among the 19 foreigners killed.

The funds were transferred under the identity of another Pakistani man who had never been to Italy and was not involved in the attacks, said Mr Fonsi.

He lives in Spain and his identity was probably stolen when he used another money transfer agency somewhere in the world, Mr Fonsi later told a news conference.

The two suspects in Brescia, identified in a police statement as 60-year-old Mohammad Yaqub Janjua and 31-year-old Aamer Yaqub Janjua, are accused of aiding and abetting international terrorism as well as illegal financial activity. Their agency, which operated on the Western Union money transfer network, was seized by police.