A British arms dealer who called himself the “Lord of War” is facing extradition to the United States after he was dramatically seized near his £800 000 suburban home.

Officers from Scotland Yard’s elite firearms squad shot out the tyres of Guy Savage’s Mercedes and threw stun grenades in an early morning ambush.

Public-school educated Savage, 42, is accused of smuggling weapons to Iraq and the Middle East.

Later a huge arsenal of weapons, including assault rifles, weapons components and ammunition was found in a raid on the married father-of-two’s house in Pinner, North-West London, and at his business premises a few miles away in Northolt.

Last night sources said more than 500 “complete” guns had been found. Four Americans are accused of being involved with Savage, owner of a company called Sabre Defence Industries, in a multi-million pound racket to illegally export weapons in crates with false bottoms and forging shipping records.

His arrest has caused acute concern at the Home Office, after claims that he had acted as adviser to ministers on firearms policy.

Last night, a spokesman would only confirm that the Home Secretary, Theresa May, had “revoked” a firearms authority on the advice of the Metropolitan Police.

An internal inquiry has begun into how Savage, who has a previous conviction from the mid 1990s for possessing and selling prohibited pump action and semi-automatic rifles, had been awarded a firearms certificate.

He is due to appear before City of Westminster magistrates this morning for the start of what promise to be lengthy extradition proceedings.

He has been indicted by a US federal grand jury on charges relating to international firearms and trafficking violations. He faces being jailed up to 20 years and fined up to $1-million on each of the more serious charges.

The indictment alleges that Savage directed the illegal activities from his personal residences in the UK, as well as from a related company owned by him, Sabre Defence Industries LTD (SDI-UK), which is a licensed manufacturer, distributor and importer of firearms and firearms headquartered in the UK.

The US indictment includes a number of revealing emails. Savage wrote to a Finnish arms company he deals with on July 25 2004: “This Iraq situation has companies banging on our door for M16s because we are the only supplier outside the US since the State Department has a lump of granite up their a**** with exporting machine guns to anywhere.”

Last night a source close to the US investigation told the Mail: “Savage was a brutal boss and he never ever took no for an answer. He had an ego that reached across the Atlantic and he thought he was untouchable.

“He liked to call himself Lord of War after that Nicolas Cage film - that’s just how arrogant this guy was - but he was operating in North London and not some remote camp in Afghanistan.

“There were up to several orders every month worth tens of thousands of pounds and this has been going on for almost a decade, so the chances are he is a very wealthy man.”

Savage, a former pupil of the £5 000 a term Highgate School in North London, was seized last on Tuesday.

A neighbour, who asked not to be named, said: “At around 8.30am, I was looking out my window and Guy drove past in his Mercedes estate. The cars that were parked quickly blocked him off and officers jumped out and started shooting. They blew his tyres.

“They threw four stun grenades and you could feel the vibrations in my house. They grabbed Guy from the car and pinned him to the ground. I heard him say ‘I’m not resisting, don’t hurt me’.”

In 1996, Savage - who that year had blamed families of the Dunblane massacre for ruining his livelihood - won a controversial court fight to continue dealing in firearms. He caused outrage when he said the families’ “hysteria and blind fury” had left him and other dealers broke.

He had been banned from possessing and trading in guns in April 1994 on the grounds he was a danger to the public. This came after a large cache of prohibited weapons was found at premises in St John’s Wood, North London.

He spent two years fighting the Metropolitan Police Commissioner’s decision to revoke his firearms licence. A judge ruled in his favour but criticised his remarks about Dunblane and even his own barrister said his client had an “unattractive” personality. - Daily Mail