Anne-Marie Evans – Eurico Guterres, leader of the Aitarak anti-independence militia, was made the head of a clandestine military-funded organisation earlier this year and supplied with guns and money, a source said yesterday.

Mr Guterres had been made a member of the Gada Paksi soon after it was created in 1994 by former president Suharto's son-in-law, Prabowo Subianto, under the direction of the army's Kopassus special forces.

The organisation's goal was to infiltrate the youth of East Timor, said the source, formerly a senior leader of anti-independence forces in East Timor.

Former Indonesian general Subianto provided a budget of 500 million rupiah to start the organisation, the source said. The organisation helped young people set up small businesses at the same time as providing military and intelligence training in Jakarta.

In January this year, regional military commander General Adam Daimari – like Mr Guterres a target of United Nations human rights investigators – met Mr Guterres, made him leader of the Gada Paksi and offered him 50 million rupiah to re-organise the group, the source said.

"That's when he got excited about all this power. From then on his members were given revolvers and ordered by Daimari to take over security in Dili," added the source.

There were about 800 members of Aitarak, the source said, of which a large majority were also Gada Paksi members. About 200 had close links to Mr Guterres, and some were also members of the Kopassus special forces, the source said.

He said Mr Guterres' parents had been pro-independence Fretilin activists. The source, who claims to know Mr Guterres personally, said the Aitarak militia leader's parents were killed for their Fretilin sympathies in 1976.

Mr Guterres, who the source said was married to the niece of East Timorese bishop Basilio do Nascimento and a father of three young children, was brought up by an Indonesian Government employee, "Eugenio", in Viqueque, East Timor. At the age of 20 he was running a secret gambling organisation in Dili. Mr Guterres had always been aware of how his parents died, but rejected their beliefs, the source said.