Hizballah's Bust of Israeli 'Spies' Shows Its Growing Power in Lebanon

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A masked Lebanese secret service officer shows a can of motor oil used to camouflage electronic devices that was found with arrested Lebanese nationals accused of spying for Israel

The captured espionage equipment on display at Lebanese police headquarters on Monday was hardly the stuff of James Bond's Q lab — just a small collection of computers, passports and electronic gear that would have looked at home in an Internet café. But then a Lebanese security agent, masked to hide his identity from the pack of journalists invited to view the spy trove, pulled away the top of a bright orange watercooler to reveal a hidden disc-shaped device, which officials explained had been used to transmit video surveillance to Israel of secret locations linked to Hizballah.

The arrest last month of two alleged spies captured along with the equipment — a retired Lebanese state security officer and his wife — marked the beginning of a purge of what Lebanese authorities are calling Israeli sleeper cells. So far, authorities claim to have closed down nine cells, arresting 26 people — including a police officer and his wife this past weekend. (See pictures of Hizballah's youth organization.)

Many Lebanese have long suspected that their country is crawling with Israeli spies, many of them left behind when Israel finally ended the 18-year occupation of southern Lebanon in 2000. But Lebanese authorities claim that the spate of recent arrests is evidence that Israeli intelligence stepped up its operations in Lebanon following the summer 2006 war with Hizballah. (See pictures of the 2006 war in Lebanon.)

The Shi'ite militant organization suffered a blow last year with the assassination in Damascus of its security chief, Imad Mughniyah — wanted by the U.S. for his alleged involvement in a number of terrorist attacks, including the 1983 bombings of the U.S. embassy and a Marine headquarters in Beirut. Although Israel officially denied involvement in the hit, the Mossad was credited with authorship both by Hizballah and the Israeli public and media.

Since then, Hizballah has stepped up its counterintelligence operations — ironically, with the help of Lebanon's Internal Security Forces (ISF), the U.S.-trained national police force. Officials say the ISF three years ago began tracking Adeeb al-Alam, a former colonel in General Security, another state security branch. When the ISF intercepted communication between him and Israeli intelligence, they began working with Hizballah, and together extracted enough information from al-Alam — whom the Lebanese now believe has been spying for the past 25 years — to crack open eight other spy cells.

Perhaps the most damaging of the alleged espionage operations is the case of Marwan Fakih, owner of a car dealership and garage in the southern city of Nabatiyeh, who had earned the trust of Hizballah's leaders but hid tracking devices inside many of the cars he sold or repaired for the group. The devices may have allowed Israeli intelligence to pinpoint secret Hizballah installations. It's not clear to what extent Hizballah has had to reorganize its operations in south Lebanon — its front line with Israel — because of the car dealer's alleged treachery, but the organization insists that it remains combat-ready for any future Israeli incursion.

However damaging these alleged spy rings may or may not have been, their exposure marks a political victory for Hizballah and a sign of the depth of cooperation between Hizballah and the Lebanese government — which the U.S. had hoped would defang the organization. A Hizballah intelligence official who spoke to TIME on condition of anonymity explained that the spy investigations involved the ISF and Hizballah exchanging information. Hizballah then took over the surveillance, arrest and initial interrogation of suspects. The organization did most of the footwork because many of the suspects are in southern Lebanon, where Hizballah is the de facto state security. But the Lebanese government is taking a more pro-active role against alleged Israeli spies than in the past, when many of those accused of working with Israel escaped punishment or were treated leniently because they belonged to politically influential Christian militia groups. This time, the accused may face the death penalty. And in order to spread the word that times have changed, Hizballah and the government may declare a short amnesty period for spies to turn themselves in, after which no quarter will be given, the Hizballah operative told TIME.

The spy arrests also signal the failure of the U.S. policy of boosting the Lebanese government as a hedge against Hizballah. Since 2006, the U.S. has given $1 billion in aid to Lebanon (of which some $410 million went to the army and security institutions) in the hope of bolstering its pro-Western government against Hizballah and its patrons in Syria and Iran. But Hizballah's power and influence in Lebanon has grown over the same period, and the opposition coalition it heads looks set to win control of the government in parliamentary elections scheduled for June. U.S. officials say they'll review the extent of Washington's commitment in Lebanon should a Hizballah-led government emerge. Even before the recent arrests, Israeli officials had expressed displeasure over American assistance to Lebanon's military and security services, warning that it could ultimately be used against Israel. That sentiment was echoed in a headline Monday in Haaretz, the left-leaning Israeli daily, which asked, "Did U.S. help crack alleged Israeli spy rings?"

With reporting by Rami Aysha / Beirut