U.S. and Iraqi forces have encircled the insurgent stronghold of Tal Afar (search), and the Iraqi military on Thursday announced the arrest of 200 suspected insurgents — most of them foreign fighters.

The Iraqi military said 150 of those arrested Wednesday in this town near the Syrian border were Arabs from Syria, Sudan, Yemen and Jordan (search).

The joint forces have reported heavy battles on the outskirts of the city and several bombings that have mainly killed civilians. Iraqi authorities reported most of the civilian population had fled the city, which is 260 miles north of Baghdad (search) and about 35 miles from the Syrian border.

"Our forces arrested 150 non-Iraqi Arabs yesterday in addition to 50 Iraqi terrorists with fake documents as they were trying to flee the city with the [civilian] families," Iraqi army Capt. Mohammed Ahmed said.

"We ordered the families to evacuate the Sunni neighborhood of Sarai, which is believed to be the main stronghold of the insurgents," Ahmed said

Eight civilians were killed in the city Wednesday by a homicide car bomber at an Iraqi checkpoint, he said. On Thursday, the U.S. military said the combined American-Iraqi force had killed seven insurgents in the past two days.

Tal Afar is 90 percent Turkmen, and 70 percent of them are Sunnis. After the ouster of Saddam Hussein, the United States installed a largely Shiite leadership in the city, including the mayor and much of the police force.

The Sunnis have complained of oppression by the government and have turned to the insurgents — who are mainly fellow Sunnis — for protection.

Early Thursday, a militant Web site carried a videotape showing the destruction of a U.S. Bradley Fighting Vehicle in Tal Afar. The video, emblazoned with the logo of Al Qaeda in Iraq, claimed the armored vehicle was struck by a roadside bomb. A U.S. military official said two Bradleys had been hit by roadside bombs in recent days and a soldier was killed.

Also Thursday, police reported finding 17 unidentified bodies — 15 near the farming town of Mahmoudiya and two on Baghdad's outskirts.

The bodies found by soldiers and police near Mahmoudiya, 20 miles south of Baghdad, were in civilian clothes, with no identification documents, and had been shot to death, police Lt. Adnan Abdulla said.

The two bodies found near a sewage plant on the outskirts of Baghdad were blindfolded and handcuffed, police said.

In central Baghdad, a homicide car bomber Thursday targeted a passing convoy of private U.S. security agents, wounding three passers-by. The blast near the heavily fortified Sadir Hotel sent a huge plume of smoke into the sky in Baghdad's busy Karradah neighborhood, a main shopping and commercial district.

A Sept. 2 car bombing near the hotel killed an Iraqi security guard and wounded two. The Sadir is used by foreign security agents and other Westerners involved in rebuilding Iraq.

On Wednesday, the U.S. military, acting on a tip, raided an isolated farmhouse outside Baghdad and rescued an American businessman held hostage for 10 months. The kidnappers, who had kept their captive bound and gagged.

Roy Hallums, 57, was "in good condition and is receiving medical care," a military statement said after U.S. forces freed him and an unidentified Iraqi from the farmhouse 15 miles south of Baghdad.

Lt. Col. Steven A. Boylan, a U.S. military spokesman, said the tipster whose information led to Hallums' release was captured just a few hours before the operation.

Hallums, formerly of Newport Beach, Calif., was kidnapped at gunpoint from his office in the Mansour district of Baghdad on Nov. 1, 2004. At the time, he was working for the Saudi Arabian Trading and Construction Co., supplying food to the Iraqi army. The kidnappers also seized a Filipino, a Nepalese and three Iraqis, but later freed them.

"Considering what he's been through, I understand he's in good condition," said Hallums' ex-wife, Susan Hallums, 53, of Corona, Calif.

The family Web site was topped with a headline: "Roy IS FREE!!!!!! 9/7/05."

More than 200 foreigners have been abducted in Iraq since the war began in March 2003; more than 30 have been killed.

The rescue coincided with two deadly bombings detonated around the southern city of Basra. A roadside bomb killed four private American security agents working for the State Department Bureau of Diplomatic Security. And an Interior Ministry official said 16 people were killed and 21 were injured in a car bombing at a restaurant in a central market.

Attacks against Americans around Basra, Iraq's second-largest city, are rare. The U.S. has only a minimal presence in the area, which is largely patrolled by British forces. Also, Shiites, who are the dominant population in the south, have found themselves the political winners as new government structures take shape after the U.S.-led invasion.

In a statement posted on a Web site known as a clearinghouse of militant claims, Al Qaeda in Iraq took responsibility for the attack.

The car bombing later Wednesday at a takeout restaurant in a central Basra market killed 16 and wounded 21, an Interior Ministry official said, speaking on condition of anonymity because he was not authorized to talk to reporters.

The restaurant is in the Hayaniyah district market, a Shiite section of the city, police Lt. Col. Karim al-Zaidi said. Two police vehicles and several nearby shops were destroyed.

Despite a peaceful postwar history in the south, violence has spiked in the past two months with attacks on Britons.