Exiled Pakistani politician and Muttahida Qaumi Movement (MQM) founder Altaf Hussain was arrested by the Scotland Yard in a dawn raid at his residence here on Tuesday, according to Pakistani media.
Fifteen officers, who took part in the early morning raid, took Hussain to a south London police station where he is under police custody.
Hussain's arrest was confirmed by MQM sources, Geo News reported.
The 65-year-old leader has been arrested in connection with a 2016 hate speech, where he had allegedly urged his supporters to take the law into their own hands.
Without naming Hussain, Metropolitan Police said in a statement that "the man who is aged in his 60s, was arrested at an address in north west London."
"He was arrested on suspicion of intentionally encouraging or assisting offences contrary to Section 44 of the Serious Crime Act 2007. He was detained under the Police and Criminal Evidence Act (PACE and taken to a south London police station, where he currently remains in police custody," it said.
"As part of the investigation, officers are carrying out a search at the north-west London address. Detectives are also searching a separate commercial address in north-west London," Metropolitan Police added.
"The investigation, which is being led by officers from the Met's Counter Terrorism Command, is focused on a speech broadcast in August 2016 by an individual associated with the MQM movement in Pakistan as well as other speeches previously broadcast by the same person," it further said.
Since the 1990s, Hussain has been living in the UK in a self-imposed exile following a crackdown on his party. He later gained British citizenship.
In the last three decades, MQM has dominated politics in Pakistan, particularly in Karachi, where the party has the support of Urdu-speaking Muhajirs, who migrated from India to Pakistan during the Partition in 1947.
Hussain regularly makes television addresses or telephone speeches to his supporters, where he heavily criticises the Pakistan Army and ISI for alleged "military oppression" of Muhajirs.
Hussain has been accused by his opponents of encouraging his party workers to indulge in violence.
Pakistani authorities have been repeatedly seeking the MQM chief's return to Pakistan to face trial in a number of murder and violence cases lodged against him.
In 2016, MQM was split into two factions -- MQM-L, led by Hussain, and MQM-P, the party based in Pakistan.
Hussain's faction had boycotted the last year's general elections in Pakistan, citing incidents of injustice meted out to the party workers at the hands of the Pakistan Army. The MQM-P is a part of the Imran Khan-led PTI coalition government.
Despite living in self-exile and the split in MQM, Hussain continues to wield considerable influence in the party.
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