Key suspect in kidnapping says Pearl is alive

Ahmed Omar Saeed Sheikh, in an undated photo

ISLAMABAD, Pakistan (CNN) -- A British-born Islamic militant believed responsible for the kidnapping of U.S. journalist Daniel Pearl was arrested Tuesday and told investigators Pearl is alive, said Karachi Police Chief Tariq Jameel.

Pakistani police said the hours immediately following the arrest would be "crucial" to Pearl's release.

In Washington, officials confirmed that the Pakistanis have Ahmed Omar Saeed Sheikh in custody. Sheikh -- sometimes called "Sheikh Omar" -- told police that Pearl was alive and still in Karachi, where he disappeared on January 23, police said.

Sheikh, 28, was arrested for the 1994 kidnapping in India of three Britons and an American tourist and was released five years later in exchange for the freedom of 155 passengers aboard a hijacked India Air flight. The son of a Pakistani immigrant couple, he grew up in London suburbs and attended elite private schools in the British capital. He attended the London School of Economics before becoming an Islamic jihadist in 1993.

Sheikh had eluded law enforcement since he was identified as a suspect in the kidnapping earlier this month. Punjab police detained Sheikh after a lengthy search of Lahore, about 654 miles (1053 km) northeast of Karachi. Investigators said they obtained the information that led to Sheikh from a series of arrests in Islamabad and Karachi on Monday night.

Sheikh will be handed over to Sindh province police and taken to Karachi later Tuesday for questioning.

Earlier Tuesday, three suspects accused of aiding and abetting in Pearl's kidnapping were remanded to police custody and are scheduled to be back in Pakistan's anti-terrorism court in 14 days to face formal charges.

The emails showed pictures of Pearl with a gun to his head

In the first case to be tried under a new amendment to Pakistan's anti-terrorism law, Fahd Naseem, "Salman" and "Adil" were formally arrested in connection with Pearl's kidnapping.

They were brought into the court with towels over their heads, surrounded by police officers and told not to talk to anyone about their case. A lawyer for one of the men told CNN that he still has not had a chance to talk to his client.

The three men were detained when investigators discovered a connection between them and a computer that had been used to send notes demanding the release of Pakistani prisoners being held at the U.S. Navy base in Guantanamo Bay, Cuba. One of the men allegedly told investigators that Sheikh had given him the text of the messages and photographs of Pearl in captivity to transmit.

Pearl, 38, a reporter for the Wall Street Journal, disappeared while supposedly on his way to interview another Pakistani militant believed to have connections with Richard Reid, the man accused of trying to blow up a trans-Atlantic flight with explosives hidden in his shoes.

In New York, the newspaper's managing editor, Paul Steiger, who has repeatedly appealed to Pearl's kidnappers to release him, told CNN he is waiting for further word from Pakistan.

"Let's hope we have some good news," he said. "It's a slow process."

Last week, CNN obtained copies of e-mails purportedly sent to Pearl by Sheikh, using the pseudonym Chaudery Bashir Ahmad Shabbir, or simply Bashir. The e-mails indicate that Pearl was lured into a trap with promises of an interview with Sheikh Mubarik ali Gilani, the head of the fundamentalist Islamic Jamaat ul-Fuqra group.

Police had briefly detained Gilani, but later said they did not believe he had a hand in the kidnapping.

-- CNN's Ben Wedeman and Hugh Williams contributed to this report