A Sri Lankan man alleged to be part of an international nuclear black market is still being held by Malaysian police, Deputy Prime Minister Najib Tun Razak said today.

Najib said he was "not denying that he is still in Malaysian custody" when asked whether the government had extended the man's detention following his arrest two years ago.

The Sri Lankan, businessman BSA Tahir, was described by US President George W Bush in 2004 as the "chief financial officer and money launderer" for Pakistan's disgraced scientist Abdul Qadeer Khan

Khan admitted passing nuclear secrets to Libya, Iran and North Korea in a televised confession in February 2004, placing him in the thick of a global atomic black market.

Tahir was arrested in May 2004 in Kuala Lumpur as a threat to national security.

Tahir can be held indefinitely without trial under the wide-ranging Internal Security Act. He was initially detained for two years.

Still a security threat

A former senior intelligence official familiar with the case told AFP that Tahir "remained a security threat" and may be withholding crucial information.

"I think he must be unwilling to divulge some information," the official said on condition of anonymity, adding that Tahir was likely being held in Kamunting detention centre in Perak.

The nuclear black market scandal embroiled Prime Minister Abdullah Ahmad Badawi's son, Kamaluddin.

He owned Scomi Precision Engineering, which manufactured centrifuge parts seized on a ship headed for Libya.

The company was later cleared by a police probe and said it had been misled about the purpose and destination of the parts, allegedly ordered by Tahir on behalf of Pakistan's Khan.

Scomi Group's chief executive officer, Shah Hakim Zain, yesterday denied Scomi had been involved in nuclear black market activity.