CANBERRA (Reuters) - An Australian emigrant and disgraced Mossad spy who died in an Israeli jail in 2010 was arrested after interfering in a secret Israeli intelligence operation to recover the bodies of soldiers killed in the 1982 Lebanon war, an Australian news report said on Tuesday.
Ben Zygier was arrested in January 2010 and held in secret under the name of Prisoner X on unspecified security charges. A judicial inquiry in Israel found Zygier, 34, hanged himself in a high-security jail cell.
Australian state television said Zygier unwittingly sabotaged a secret 2007 Mossad mission to exhume the bodies of three Israeli tank crewmen captured and killed by Syrian forces during Israel's invasion of Lebanon.
The television report quoted a former commander in Lebanon's Bekaa valley as saying that Zygier had revealed his name and that of a Lebanese agent for Israel to Lebanese intelligence.
Ziad al-Homsi, former mayor of a Lebanese village, told ABC television that he had been approached by Mossad in 2007 and flown to China on the pretext of attending a mayoral convention.
He was introduced to a Syrian man who said his brother in Europe was working to return the bodies of the three Israelis captured during the so-called Battle of Sultan Yacoub in the Bekaa Valley -- Israeli-U.S. citizen Zachary Baumel and his fellow Israeli crewmen Yehuda Katz and Zvi Feldman.
Al-Homsi told the ABC that he suspected he had been ensnared in a Mossad operation. He was eventually told by others involved that the missing men were buried in Lebanon.
"At the last meeting they informed me about the location of the corpses exactly. I had to find a way to get the bodies and keep them," al-Homsi said, though he was given no details on how the remains would be turned over to a separate Mossad team.
The mission failed, al-Homsi said, after he was arrested on May 16, 2009 by Lebanese special forces and later jailed for 15 years for spying for Mossad. He served three years.
Zygier's crime was to inadvertently reveal Al-Homsi's identity to a Lebanese man he was trying to turn into a double agent, but who worked for Lebanese intelligence, the ABC said.
FADING MOSSAD CAREER
Zygier, acting alone, was trying to trying to turn around a fading career with Mossad, to which he had been recruited in 2004 after taking Israeli citizenship in the mid-1990s.
Australia's Fairfax newspapers and Germany's Der Spiegel said in March that Zygier, the son of a prominent Melbourne Jewish family, had believed the man was close to Hezbollah militants.
The plan went wrong when Zygier tried to prove his credentials by giving up the name of al-Homsi and another Lebanese agent for Israel named Mustafa Ali Awadeh. His actions caused Israel to abandon the mission, the ABC said.
Israel has refused to disclose details of the case, refusing a request for information from Australia's Department of Foreign Affairs and Trade. The case has been the subject of gag orders in Israel.
Zygier was arrested by Israel's internal security service Shin Bet and later jailed at the high security Ayalon Prison, committing suicide in his cell later that year.
Israel's Justice Ministry said last month it would not press charges over the suicide, despite missteps by jail officials on the day of his death.
Zygier received "distressing news" from his wife hours before hanging himself, but the jailer overseeing surveillance video from the cell missed the moments leading up to his death.
The case was kept secret until February, when an Australian television expose uncovered it, sparking media debate about Zygier's intelligence role and the nature of his alleged crime.
(Reporting by Rob Taylor; Editing by Ron Popeski)