The brother of an British-Iraqi shot dead with his family in the French Alps was today arrested as part of investigations into an alleged dispute over a family inheritance.

Although Surrey police declined to identify Zaid al-Hilli as the suspect arrested today, a source in France confirmed that it was the 54-year-old older brother of Saad al-Hilli whose family was savagely attacked by a gunman on a forest track near Lake Annecy in September last year.

Surrey Police said the man was detained at an address in Chessington, Surrey at around 7:30am on suspicion of conspiracy to commit murder. Detectives were later seen carrying evidence bags, a box and a ladder as they emerged from the block of Chessington flats where Zaid al-Hilli lived.

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Saad Al-Hilli from nearby Claygate, his wife Iqbal and her mother Suhaila al-Allaf, who lived in Sweden, were shot dead with a French cyclist, Sylvain Mollier in a remote forest lay-by near the village of Chevaline.

Their daughters survived the shooting. Four-year-old Zeena was discovered under her mother’s body inside the family car, eight hours later. Her sister Zainab, seven, was found with serious head injuries after being shot and beaten.

Zaid al-Hill was questioned by British police last year about a possible connection with the disputed inheritance of their father who died in 2011. He denied all links with the killings.

In recent weeks, French investigators – working in a European Joint Investigation Team with Surrey and Sussex Police – have been looking into phone calls made by Zaid Al-Hilli to Romania in the weeks before the murders.

French prosecutor Eric Maillaud said that investigators were looking into what they believed was a “family dispute that pitted the two brothers on the issue of the inheritance of their father”. He added: “There are very specific questions which needs to be asked about it.”

In their statement yesterday, Surrey police said: “Officers from the Surrey and Sussex Major Crime Team have been working closely with the French authorities to progress a number of lines of enquiry. This pre-planned arrest is a result of these on-going enquiries.”

Since the quadruple murder nine months ago, French investigators initially appeared to favour the theory of family quarrel or a connection with the family’s past in Iraq. More recently, they had appeared to steer the investigation towards the possibility a random slaughter by a lone psychopath.

The French cyclist, Mr Mollier, 45, is believed to have stumbled on the murder scene. Both he and Saad Al-Hilli were initially wounded by a volley of shots from an antiquated 7.65 mm Luger automatic pistol, according to a forensic examination of the crime scene.

Both men were killed after the murderer had turned his gun on Iqbal, 47, and her mother Suhaila al-Allaf, 74, who were still in the family car.

Studies of the shoes of the victims suggest that Mr Al-Hilli, and his daughter Zainab, had been outside his BMW estate car when first attacked by the killer. Mr Al-Hilli, who was on a caravan holiday nearby, fled to his car and tried to drive away but he reversed at speed into a steep forest bank and became stuck. He was found dead at the wheel of his car with the engine running and the wheels still spinning.