BY MARIKA LYNCH

 Peru's second-most-wanted man wasn't difficult to find in South Florida.

 Víctor Alberto Venero Garrido -- a suspected arms dealer accused of skimming
 more than $100 million from a government pension fund -- had opened a $15
 million bank account in his own name.

 Venero, an associate of Peruvian spy master Vladimiro Montesinos whose own
 scandal brought down the government of President Alberto Fujimori, was arrested
 on public corruption and money laundering charges after he tried to make a
 withdrawal at a Miami Citibank on Friday.

 On Monday, he asked a federal magistrate to let him out on bond because the
 stress was aggravating his rare form of lung and colon cancer. Jail guards
 ridiculed him when he told them he was bleeding from his rectum Sunday night,
 Venero told U.S. Magistrate Judge John J. O'Sullivan. A hearing will be held
 Friday, when Venero's Texas doctor will testify about his condition. He is being
 held at the Federal Detention Center in downtown Miami.

 His survival is important, Venero told the judge, because he has undergone an
 experimental treatment that can benefit others.

 ``The research will save other lives,'' Venero said.

 MAINTAINS INNOCENCE

 The 47-year-old maintained his innocence Monday, but neither he nor his Miami
 lawyers, Walter Reynoso and Scott Srebnick, explained the origins of his Miami
 fortune. Venero's Peruvian attorney, Luis Roy Freyre, said his client has lived in
 the United States since 1998 when he began cancer treatment. He told The
 Herald Venero's money came from his construction and textile businesses back
 home.

 The controversy surrounding Venero's past touched the country's highest political
 official this weekend, when a report surfaced that Venero's family had given
 $30,000 to interim President Valentín Paniagua to cover costs for his
 congressional campaign. Paniagua went on national television Sunday night to
 deny it and called the allegation by a onetime Montesinos security guard ``an
 open and brazen conspiracy,'' the Lima daily El Comercio reported.

 SIGNIFICANT ARREST

 Apart from that, Venero's arrest is significant because it will aid the investigation
 into Montesinos, a top Fujimori advisor who left the country after a video showed
 him apparently bribing a congressman, said Gustavo Gorriti, a Peruvian journalist
 and author living in exile in Panama. The U.S. government's help in his capture
 also was noteworthy, Gorriti said, because Montesinos is known as a one-time
 CIA informant.

 According to court documents released Monday, the Peruvian government, which
 is seeking to extradite Venero, alleges he was Montesinos' most trusted
 ``bagman'' or ``strawman.'' Venero allegedly used his position as the ``de-facto''
 head of the country's military and police pension fund to pilfer millions he then
 used to buy apartment complexes, hotels and buildings, the documents said. He
 would then sell the assets back to the fund, at inflated prices.

 Venero also helped Montesinos organize a scheme to sell substandard arms from
 Belarus and other countries to the Peruvian military at excessive prices, the
 documents said.

 $15 MILLION ACCOUNT

 The FBI was first alerted to Venero earlier this month when Venero's $15 million
 account showed up on a routine check of required bank reports, said Frank
 Figliuzzi, assistant special agent in charge for the FBI in Miami.

 The Peruvian government officially charged him Jan. 19 and sent out a request
 through Interpol for help in locating him three days later. The FBI then tracked
 Venero to a house in Southwest Miami-Dade.

 Fearing Venero was about to transfer the money to another bank, the agency
 froze his assets Friday. The suspected arms dealer found out when he tried to
 withdraw millions at 10 that morning.

 He stayed at the downtown bank several hours, trying to figure out how to get the
 money, Figliuzzi said. He finally left a few hours later, had a drink at a hotel bar,
 then went home. About 11:30 that night, the agency arrested him at home.

 At first, the FBI believed Montesinos might be in tow. But the agency has no
 information that the former head of Peru's intelligence agency is in South Florida,
 Figliuzzi said.

 The FBI does have information, however, that Venero has a handful of other bank
 accounts around the country.

 ``There are many more millions involved in this case, and we are as I speak
 becoming aware of more millions elsewhere,'' Figliuzzi said.

 This weekend's arrest was not Venero's first in South Florida, Miami-Dade Police
 say. Venero has an assault and battery charge stemming from a domestic
 violence incident the morning of July 16, documents show.

 He was arrested by Miami Beach Police at the Fontainebleau Hilton, 4441 Collins
 Ave., in room 1076. Booking records show he was released the next day on
 $1,500 bond.

 Herald staff writer Elaine de Valle, Herald translator Renato Pérez and Rui
 Ferreira of El Nuevo Herald contributed to this report.