PARIS, 3 April 2007 — There is no honor among thieves, the angry Algerian said.

Bassam Rifai was fuming that a member of his own gang in Zurich, Switzerland, had made off with expensive stolen merchandise, according to a wiretap in an investigation of alleged terror financing.

“The group was in the mountains in Algeria waiting for the money,” Rifai said, according to a transcript. “And he ripped me off. He stole computers I wanted to send to them in the mountains. . . . We all know you have the right to kill if someone touches one of three things: Religion, honor and money. For five months, I got up at 5 a.m. to prowl to make that sum.”

A few months after that conversation last year, Swiss police arrested Rifai and three other suspects. Now, interconnected investigations are trying to prove that muggings in Switzerland, burglaries in Spain and tax fraud in Italy helped fund bombings and ambushes by an extremist group in Algeria.

The cases explore the ground-level mechanics of terror financing — and raise the specter that logistics cells in Europe could transform into an advance guard for attacking the West. They also show the difficulties of prosecuting an offense on the blurry line between crime and extremism.

The money allegedly flowed to an Algeria-based network that recently had renamed itself Al-Qaeda in the Magreb and declared allegiance to Osama Bin Laden’s network, part of an attempt to reinvent itself as a regional movement.

Although not long ago Algerian security forces seemed to have the group on the run, it has regained strength: sending fighters to Iraq, training recruits in the Sahara and working to federate networks across North Africa in a wider struggle.

“They have proclaimed the internationalization of their combat, certainly continuing to target Algeria, but also Western countries,” a top French intelligence official said.

The network has bombed the convoys of foreign contractors in Algiers and also might be tied to a recent botched suicide bombing in Morocco and a Moroccan operative captured in Spain. In February, police in the northeastern town of Reus arrested Mbark Jaafari, a semi-professional boxer known as “The Tiger,” who is accused of sending 32 recruits to train or fight in Algeria, Iraq and Afghanistan, police say. US anti-terror agents suspected him of plotting against US targets, a senior Spanish law enforcement official said.

“That was an alert the Americans gave us: that he wanted to do something against American interests in Europe,” the Spanish official said.

In contrast, financing cells dedicate themselves mostly to criminal activity and can be anarchic, with suspects stealing from each other and fighting over money, investigators say. But police assert that they have uncovered direct links to attacks and leaders in Algeria.

While under surveillance by Italy’s Financial Guard in 2005, suspects in Milan, Italy, got a phone call from an Algerian militant exulting about a “wedding” in a town called Biskra. Investigators allege that the word is extremist code for an attack — and that an ambush in Biskra had killed a dozen Algerian soldiers two days earlier.

The Italian suspects had advance knowledge of attacks carried out by the militants they helped fund, according to the testimony of an associate.

“These people in Italy always have first-hand news about what happens in Algeria,” he said, according to documents. “I remember Ammar telling me about an attack beforehand, he specifically told me, ‘In 10 days there will be an attack on the police in Bad el Oued.’ “

The half-dozen suspects in Italy were mostly in their 30s and 40s, often veterans of combat in Bosnia and Algeria. They are accused of raising money through a restaurant, an electronics company and an import-export company, as well as from contributions from around Europe. The nominally legitimate businesses evaded taxes and engaging in other skullduggery, investigators say

A suspect in Naples, Italy, owned a bus company that was used by clandestine cash couriers who rode the buses to Marseilles, France, then traveled by sea to Algeria, investigators say.

“Twice a week they sent three or four trusted people carrying about $2,000 apiece,” said Lt. Col. Domenico Grimaldi of the Financial Guard. “That adds up over time.”

The group also allegedly used false identities to make illegal wire transfers. The total allegedly provided to Algerian militants exceeds $2 million, Grimaldi said. Police worry that North African networks could decide to use the financing cells to strike in Europe. The finance cases allegedly have ties to suspects charged with plotting to bomb the High Court in Madrid, Spain.

While the suspects in Italy showed little appetite for hands-on violence, the Swiss group seemed angrier, investigators say. Rifai cheered a television news report about the deaths of four Israelis in a bombing and rhapsodized about the glory of “martyrdom,” according to a transcript. “They should give you an explosives belt!” he said, according to the transcript. “The odor of the martyr. . . . I tell you, it is an odor.”

Police became alarmed in late 2005 when wiretaps suggested that Rifai and a Libyan associate talked about using a grenade launcher to shoot an El Al jet on the tarmac at an airport, according to documents and investigators. El Al diverted several flights, but the suspected plot never developed, according to documents and investigators.

Despite painstaking surveillance, the Swiss charges could be difficult to prove, say anti-terror officials familiar with the case.