JERRICK: So he's working for the Brits to try to give them information about Al-Qaeda, but in reality he's still an Al-Qaeda operative.

LOFTUS: Yeah. The CIA and the Israelis all accused MI6 of letting all these terrorists live in London not because they're getting Al-Qaeda information, but for appeasement. It was one of those you leave us alone, we leave you alone kind of things.

JERRICK: Well we left him alone too long then.

LOFTUS: Absolutely. Now we knew about this guy Aswat. Back in 1999 he came to America. The Justice Department wanted to indict him in Seattle because him and his buddy were trying to set up a terrorist training school in Oregon.

JERRICK: So they indicted his buddy, right? But why didn't they indict him?

LOFTUS: Well it comes out, we've just learned that the headquarters of the US Justice Department ordered the Seattle prosecutors not to touch Aswat.

JERRICK: Hello? Now hold on, why?

LOFTUS: Well, apparently Aswat was working for British intelligence. Now Aswat's boss, the one-armed Captain Hook, he gets indicted two years later. So the guy above him and below him get indicted, but not Aswat. Now there's a split of opinion within US intelligence. Some people say that the British intelligence fibbed to us. They told us that Aswat was dead, and that's why the New York group dropped the case. That's not what most of the Justice Department thinks. They think that it was just again covering up for this very publicly affiliated guy with Al-Muhajiroun. He was a British intelligence plant. So all of a sudden he disappears. He's in South Africa. We think he's dead; we don't know he's down there. Last month the South African Secret Service come across the guy. He's alive.

JERRICK: Yeah, now the CIA says, oh he's alive. Our CIA says OK let's arrest him. But the Brits say no again?

LOTFUS: The Brits say no. Now at this point, two weeks ago, the Brits know that the CIA wants to get a hold of Haroon. So what happens? He takes off again, goes right to London. He isn't arrested when he lands, he isn't arrested when he leaves.

JERRICK: Even though he's on a watch list.

LOFTUS: He's on the watch list.The only reason he could get away with that was if he was working for British intelligence. He was a wanted man.

JERRICK: And then takes off the day before the bombings, I understand it--

LOFTUS: And goes to Pakistan.

JERRICK: And Pakistan, they jail him.

LOFTUS: The Pakistanis arrest him. They jail him. He's released within 24 hours. Back to Southern Africa, goes to Zimbabwe and is arrested in Zambia. Now the US--

JERRICK: Trying to get across the--

LOFTUS: --we're trying to get our hands on this guy.

JERRICK: John, hang around. I have so many questions now.

LOFTUS: Oh, this is a bad one....

[commercial break]

JERRICK: On the phone with us, Mansoor Ijaz; Mansoor you know very well here at Fox News Channel and Dayside. Mansoor, real quickly here, you spent so much time in London, you're probably not that as impressed as I am about how fast Scotland Yard has worked on this case. So impressive, so successful. Why?

MANSOOR IJAZ: Well there are two things that a lot of domestic intelligence agencies don't around the world. One is an extraordinarily detailed database of information, and that database is buttressed by the fact that they have these photos, the graphic images of the faces of the people that they were looking for. So it saved them a lot of time when they got the forensic evidence, like fingerprints or other things that indicated where they could actually go find these people. Because remember, there was a lot of data left on the stuff these guys left behind from the failed bombing attack, and that's what helped to really unravel the cell. Now--

JERRICK: I guess--go ahead, Mansoor.

IJAZ: Now I think there's one very important thing that I think everybody needs to know. And that is that the cellular structure that this new breed of Al-Qaeda people have is such that there is not a clear indication that they all knew each other as much as it is that they had some sort of central control still sitting outside of the framework. Whether that's in a foreign country or a place that is removed from Britain and other place in Europe, that's what we're still looking for. But it's very clear now that these cellular structures were operating independent of each other, but with knowledge that something else was in fact planned in the pipeline.

JERRICK: Real quick, Mansoor. In that regard, maybe a ringleader could be this Haroon Aswat. What do you know about him?

IJAZ: Well, he's a pretty bad guy, and I think your previous guest gave the best assessment of who he is. He's the right hand man of the Al-Muhajiroun leader in London, and has been organizing and planning for some time. And I don't want to minimize the effect of the arrest in Rome, because what that indicates is that the cellular structure is elsewhere and we all know that Italy is a big target on their list.

JERRICK: OK, speaking of him, back to the comments by our John Loftus a little while ago. A question from the audience for you, John. Go ahead.

AUDIENCE MEMBER: Hi Mr Loftus. I recently read a book by Morris Dees called The Gathering Storm , and it talks about extremist militia groups in the United States and how they might be manipulated by some people's rhetoric, very similar to Aswat in London. What do you think the US is doing to prevent terrorist attacks on our own soil that happen--

JERRICK: You're worried about it here?

AUDIENCE MEMBER: Yes, sir.

LOFTUS: The US government's doing a great job. We arrested the New York branch of Al-Muhajiroun two years ago. We found the subway bombers with the plans to blow up two different subway stations in New York City. The rest of the group is under surveillance. But the US was used by Al-Muhajiroun for training of people to send to Kosovo. What ties all these cells together was, back in the late 1990s, the leaders all worked for British intelligence in Kosovo. Believe it or not, British intelligence actually hired some Al-Qaeda guys to help defend the Muslim rights in Albania and in Kosovo. That's when Al-Muhajiroun got started.

IJAZ: Which is by the way why we know so much about them right now.

LOFTUS: Yes, I'm afraid so. The CIA was funding the operation to defend the Muslims, British intelligence was doing the hiring and recruiting. Now we have a lot of detail on this because Captain Hook, the head of Al-Muhajiroun, he sidekick was Bakri Mohammed, another cleric. And back on October 16, 2001, he gave a detailed interview with al-Sharq al-Aswat, an Arabic newspaper in London, describing the relationship between British intelligence and the operations in Kosovo and Al-Muhajiroun. So that's how we get all these guys connected. It started in Kosovo, Haroon was 31 years old, he came on about 1995.

JERRICK: OK. Here's another question for you.

AUDIENCE MEMBER: Hello, John. With the quid-pro-quo relationship that London obviously had with these terrorists early on, what changed that caused them to all of a sudden get away from the you leave us alone, we'll leave you alone situation?

LOFTUS: The Israelis say that the truce went on for years. Guys from Al-Muhajiroun for example would bring suicide bombers to Israel to blow up Mike's Place. There was a definite link there. And yet the trainer, Sadiki Al Kahn, was able to go back to Britain and not be touched. What the Israelis believe happened is that Usama Bin Laden got desperate, and he said burn all our bridges--let's turn on the British. Break the truce, start the bombs.

JERRICK: Speaking of Usama Bin Laden, Mansoor, real quickly, maybe Scotland Yard and those folks over there, the Brits, should be looking for Usama Bin Laden. They seem to be so successful.

LOFTUS: The British police do a remarkable job.

IJAZ: Well, that's an interesting comment. The fact of the matter is, when you're dealing with it in your own backyard, and you have the computer infrastructure set up in such a way that you can immediately track these kinds of things that are in your backyard, it's a very different game from tracking them on places where we don't even have mountain maps any more of how the whole thing looks. So that's really what the fundamental problem is. If you'll permit me, I just want to, Mike, make one other very quick point.

JERRICK: Mansoor, can you hang over, do you have time hang over for a 30-second break here? John Loftus, got to cut you loose but thanks for the info. Boy, interesting stuff John...

[commercial break]

JERRICK: We have some more information from our Mansoor Ijaz, Fox News Foreign Affairs Analyst. Mansoor, still on the phone with me?

IJAZ: Yeah, I'm here with you Mike.

JERRICK: Talk about your information from British intel.

IJAZ: Well, let's not characterize the sources quite that way, but I've talked to some people who are analyzing what came out of the raids today, and there's a great deal of concern about the fact that there may be in fact a desire of these cells to move beyond transit systems as the target. And what specifically they found was evidence that indicates they're looking at now places where there are large collections of people, where they can actually take shopping bags and other large carrying bags of sorts without raising a lot of suspicion. Obviously shopping malls come immediately to mind, but it's important for everybody to know that London was planning on having a large I think it's a City Fair or something like that, I don't know what exactly it's called. They've now decided to go ahead with that, but it's obviously going to be much more scrutinized than it would have been before. Now London doesn't in general have a lot of large shopping malls, but they do have large concentrations of people in places at certain times during the week, and that's what apparently now has become the target, one of the new targets of these terrorist cells.

JERRICK: So Mansoor, when you hear that we have four for four, or four for five of these 7/21 bombers, nobody should fool themselves. This thing isn't over.

IJAZ: That is precisely the point I wanted to make sure everybody understood--that the authorities, the people that are worried about this and that are analyzing the data out of what they're getting in these raids, are basically saying we may have just hit the tip of the iceberg. This is not over by a long shot.

JERRICK: Mansoor, thank you for making that perfectly clear. Talk to you soon."