In rebellious east, fears grow that exiled loyalists will make bloody return

Fears are rising in the east of Libya that a mercenary militia is preparing to sweep into the country from Egypt to take bloody revenge on the dissidents who drove Gaddafi's forces out.

At a rebel staging post at Ba'r Lashan, outside the city of Tobruk, rumours abounded that Gaddafi's supporters had slipped across the border to impose a tribal levy to fund a strike at the rebels. Libyans and Egyptians interviewed close to the border claimed they had witnessed Ahmed Gadhaf al-Dam, a cousin to the Libyan leader and one of his closest aides, offering a mixture of bribes and invectives against "traitors". In Tobruk there was alarm at the tales of the alleged activities of al-Dam, whose name denotes "bloodthrower".

Al-Dam was said to have been spotted at the city of Matrouh, around 200km from the Libyan border, on Wednesday. According to local people he left in a convoy of four-wheel drive vehicles early yesterday morning, and elders from the Oladli clan of the Martrouhi tribe say al-Dam is now headed for upper Egypt and his own clan base for pre-arranged meetings before returning to Tripoli.

But yesterday al-Dam presented a very different version of his status, issuing a statement denouncing the regime. It is an indication of the confusion swirling around Libya, thanks to the limitations on communications and the media. Other reports suggested that he had been in Cairo for days.

Al-Dam holds an Egyptian passport and Egyptian officials, who say they are aware of his possible presence, say that he has every right to travel to his second home. There is also confusion, they say, on whether he is in breach of international law if he is trying to enforce the jurisdiction of the government of Libya. One official, however, stressed that Cairo would not want any escalation of bloodshed in the neighbouring country.

At Ba'r Lashan, groups of young men, some with their faces hidden by keffiyahs, vowed they would defend liberated Libya at all costs. They said that they had seen foreign "mercenaries" from sub-Saharan Africa in the area, preparing to launch a counterattack. "We have seen them, they are driving around in small trucks," one of the men said. "These are the same bastards who murdered our people on behalf of Gaddafi. Most of them have now fled to the east but there are some still here."

And while there was elation yesterday that Saif al-Arab, one of Gaddafi's sons, was said to have defected and taken refuge in Benghazi, there were continued fears of reprisals. "There are Libyan [pro-Gaddafi ] militiamen who are in hiding," said Yusuf Maghzi, a 19-year-old student. "Two of them were caught and killed three days ago, I was there. But we are optimistic, most of the regular soldiers are with us."

One of those was a female officer, Major Salma Faraj Issa, who had served as aide to the commanding officer of the Tobruk garrison. She struck a note of defiance. "The army are the people and the people are the army," she said. "We are ready to protect the territory. What happens if Gaddafi attacks? We are ready, we have RPGs [rocket propelled grenades], we have some artillery. We are prepared to die for our country because we are soldiers."

Major Issa and her comrades were watching local people in Tobruk celebrate their new-found freedom with chants of "the people want to get rid of Gadaffi" and "All Libyans are united".

Lieutenant Colonel Omar Hamza, of the Air Defence Brigade, explained that a unified command is being created by the dissident military units. "We want others in the army not in the liberated areas to join us. There have been a lot of killings in Tripoli as well. We think the army standing together will stop this."

But Gaddafi loyalists are feared nonetheless. "They showed us no pity," said Mohammed Qassim, a 56-year-old shopkeeper. "They killed women and children. I saw an old man get shot and he was not even taking part [in the demonstrations]. They shot him from a window in the headquarters of the Revolutionary Committee, he was lying in the street and people could not go to help him because they were afraid of getting shot themselves."

The Revolutionary Committee acted as the censorious eyes and ears of the regime in the city. Hassan Ibrahimi, pointing at a torn-down poster of Gaddafi lying in the rubble, exclaimed: "Muammar kept his spies to keep us quiet. Well we have chased off the spies and we shall never have people like them here again. That is the reason why this place was destroyed.

"This is a rich country, we should be one of the richest in the world. But Muammar spent the money on his mercenaries and his spies."