Two leaders of a mosque in Albany, N.Y., were arrested Thursday and charged with helping an undercover informant posing as a weapons dealer who was plotting to buy a shoulder-launched missile that would be used to kill the Pakistani ambassador in New York City.

Yassin Muhhiddin Aref (search), 34, the Imam of the mosque, and Mohammed Mosharref Hossain (search), the 49-year-old founder of the mosque and owner of the local Little Italy Pizzeria, were arrested early Thursday morning at their homes. The person they were allegedly collaborating with was not a terrorist but an informant participating in a sting operation; no missile ever was exchanged.

Click to read the charges (FindLaw pdf).

"The fact is, there are terrorists among us who want to engage in acts to attack us again and take away our freedom," Gov. George Pataki said in a news conference Thursday. "Our government, our administration in Washington … and local officials are taking this threat to our freedom very seriously and will continue to be aggressive and proactive against those who would wish to do us harm."

The arrests were in large part due to tips from the public, Pataki and Albany Mayor Jerry Jennings said. Within the past two years, there have been several arrests in the Buffalo and Syracuse areas of people suspected of having terror ties, including the so-called Lackawanna Six (search).

"Ultimately, this war against terror … depends on the eyes and ears of the people of America and the people of New York," Pataki said.

Saying the tipsters "know who they are," Jennings said: "We want people to feel good about what happened today because we are on top of it, we are being proactive … to make sure our communities are safe."

The suspects' wives denied the men were involved in any terror plot.

"It's totally wrong and totally false and totally a lie," Hossain's wife, Mossamat, said in a telephone interview.

Authorities said the men were paid $65,000 in checks and cash to purchase a missile and disguise the source of the money involved.

The men are charged money laundering, conspiracy to commit money laundering and conspiracy to conceal material support for terrorism. Both could face up to 70 years in prison and a $750,000 fine.

U.S. Magistrate David Homer ordered the men held without bail pending a hearing on Tuesday.

The men may also have ties to terrorist group Ansar al-Islam, which has been linked to Usama bin Laden's Al Qaeda (search) terror network, according to law enforcement officials. However, that link was not noted in court documents.

Ansar al-Islam has claimed responsibility for a series of bombings, kidnappings and killings in Iraq, and has ties to the U.S.-led coalition's most-wanted terrorist there, Abu Musab al-Zarqawi (search).

Deputy Attorney General James Comey declined to discuss any alleged ties but said more information about their backgrounds may come out in court proceedings.

The FBI, Immigration and Customs Enforcement and other agents executed search warrants at the Masjid As-Salam mosque and two Albany-area residences. Officials said the arrests have nothing to do with the U.S. government raising the terror alert level for New York, Washington, D.C., and Northern New Jersey on Sunday.

The informant told the men he was associated with Jaish-e-Mohammed (Army of Mohammed), an Islamic extremist group in Pakistan that the U.S. government considers a terrorist organization. According to court records, the informant told the pair that the missile would be used to kill the Pakistani ambassador in New York. Hossain then allegedly referred to Pakistani President Pervez Musharraf (search) as an "idiot" and a "bastard."

The men were picked up Thursday morning because of law enforcement's concern that they were flight risks; one of the men reportedly tried to buy a plane ticket recently.

The investigation has been going on for a year, officials said, and several searches in the Albany area related to Thursday's arrests are being conducted.

Comey stressed to reporters Thursday afternoon that the case is not connected to the current terrorist threat and the men charged weren't necessarily plotting terrorist violence.

"This is not the case of the century," he said. "That does not mean, however, that this is not an important case ... We hope it will send a disrupting message to those out there who might be plotting to harm this country ... our agents and informants are putting a full-court press on in this country and around the world."

Although Comey was questioned as to whether Aref and Hossain were entrapped for no good reason, the government official said there is more to the story that will soon be revealed.

"We believe there was ample predication for this investigation ... this is a good case, a solid case, and it sends a message," Comey said.

A detention hearing for the suspects likely will be held next week, Comey added.

The Charges

The criminal complaint against the mosque leaders was filed Thursday in federal court in Albany. They are officially accused of attempting to launder money and conspiring to launder money from illegal activity to fund the purchase and use of a weapon of mass destruction.

The criminal complaint says that during the summer of 2003, when the probe began, the FBI monitored and recorded most of the conversations between the FBI's informant and Aref and Hossain.

The conversations were mostly in Urdu between Hossain and the informant; the conversations between the informant and Aref were mostly in English.

According to the complaint, the informant had helped Hossain get his brother a fake New York state driver's permit, and the two got to talking about jihad, or holy war. The informant asked whether money could be made by jihad; Hossain first said no, then possibly and asked for a loan.

The government says that in November, the informant showed Hossain a shoulder-fired surface-to-air missile and told Hossain that he imports weapons from China to New York City. The informant said Hossain smiled when he saw the missile and said that he had never seen such a weapon before except on television. The informant also said that Hossain said a lot of money could be made from such an importation.

During a December conversation in Hossain's pizzeria, the informant proposed that Hossain take $50,000 in cash proceeds from the missile importation, then repay $45,000 of that by writing the informant monthly $2,000 checks and keeping the remaining $5,000 for himself.

"After initially indicating that he did not need that much money, Hossain agreed to the proposal," the complaint charges. Hossain allegedly then said that he could make it appear that the proceeds of the missile importation had been generated through Hossain's rental properties.

On Dec. 5, Hossain told the informant he had been questioned by FBI agents about others around Albany; they discussed having Aref as a witness to the transactions and Hossain allegedly said Aref is "not afraid of anything. He's only afraid of God."

On Dec. 10, the informant met with Aref and Hossain and discussed the operation for "brother mujahadiin." They wrote down the details of the transaction.

They met again on Jan. 2 to allegedly consummate the deal. Hossain wrote the information down and Aref signed as a witness. Money was continuously changing hands. On Jan. 14, the informant told Aref that he was working with Jaish-e-Mohammed and that the purpose of the missile was to teach Musharraf a lesson. Aref said the Jaish-e-Mohammed are working for Allah and "it is wise for you to help them if you can."

The informant cited had been previously arrested in Albany and had pleaded guilty to a felony related to the fraudulent acquisition of documents. The informant, not a U.S. citizen, is cooperating in the hopes of getting a reduced sentence and has provided information leading to other arrests.

Proud to Be an American?

Some mosque members held morning prayers Thursday on a nearby sidewalk; they weren't allowed to enter the building, which is located at 276 Central Ave. near the corner of N. Lake Ave., just a few blocks from Washington Park. The mosque's name means "house of peace."

Hossain, who emigrated from Bangladesh in 1985, worked as a dishwasher in diners before saving up enough money to open his own pizzeria in downtown Albany in 1994.

In a recent interview with the Albany Times Union, the married father of five said it was his dream to come to America. He also said he's "proud to be an American."

Mossamat Hossain said in a phone interview that more than a half-dozen agents stormed the family's apartment at about 1:30 a.m., just as her husband returned from New York City, where he had gone to buy a plane ticket to Bangladesh for her mother.

Aref's wife, Zuhor Jalal, said the FBI came to her home about 2 a.m. and told her they had her husband in custody. They took her and her three young children to a hotel and then searched their home.

Jalal said she and her husband are natives of Kurdistan and lived in Syria for five years before coming to America.

"We come for freedom and job," she said.

Concerns about terrorists using shoulder-fired missiles to take down commercial airliners were heightened in November 2002 when two SA-7 missiles narrowly missed an Israeli passenger jet as it took off from Mombasa, Kenya. It's believed Al Qaeda probably was behind the attack.

Last November, a shoulder-fired missile struck a cargo plane at Baghdad International Airport, forcing it to make an emergency landing at the airport with its wing aflame.

Estimates put the number of such missiles around the world at 750,000, and they're easy to obtain on the black market.

The arrests were the second such get for law enforcement when it comes to shoulder-fired missiles.

Hemant S. Lakhani, 68, was arrested last August after he tried to buy an anti-aircraft missile in Newark from an undercover agent working with the FBI. Lakhani thought he was dealing with a man representing a Somali terrorist group.

Prosecutors said more than 150 covertly recorded conversations prove that the Indian-born British citizen was trying to deal arms to terrorists.

Also arrested in August were Yehuda Abraham, 76, a New York diamond dealer, and an Indian citizen, Moinuddeen Ahmed Hameed, 38.

FOX News' Liza Porteus, Anna Stolley and The Associated Press contributed to this report.