A Lebanese Shiite Muslim businessman with strong ties to Hezbollah has been arrested for allegedly running a $400 million Ponzi scheme, officials said.

Investors with Salah Ezzedine say they were lured by promises of high returns, but now he has declared bankruptcy is being referred to as the "Lebanese Bernard Madoff," The Financial Times reported Wednesday.

Lebanese authorities would only say that Ezzedine has declared bankruptcy and has been arrested, but a central bank official told the newspaper it is estimated that some $400 million of invested capital may be missing, rocking the poverty-stricken Shiite community and hurting Hezbollah's image of austerity.

Some of Ezzedine's investors told the Financial Times they were lured by the promise of returns as high as 20 percent, 30 percent and even 60 percent annually, claiming that middlemen promised the profits were "guaranteed."

The newspaper said Ezzedine is a Shiite religious ideologue who founded a publishing house regarded as a front for Hezbollah, a Lebanese militia and political party that Washington and Israel have labeled as a terrorist organization.