(CBS) Five men who worked, lived and socialized together in western New York were schooled in the tools of terror, including the use of suicide as a weapon, in camps run by Osama bin Laden's al Qaeda network, federal officials said.

Federal authorities who announced the arrest of the members of the alleged terror cell said Osama bin Laden himself lectured the men on his anti-American beliefs while they were in Kandahar, Afghanistan, in the months leading up to the Sept. 11, 2001, terrorist attacks.

The men came home to Lackawanna, 5 miles south of Buffalo on the shore of Lake Erie, in June 2001. Federal agents said they had no information the cell was planning an attack in the United States.

"We have the key players in western New York," FBI Special Agent in Charge Peter Ahearn said Saturday. He added the investigation was continuing.

The Bush administration hailed the arrests in New York and the capture in Pakistan of a suspected Sept. 11 operative as a victory in the war against terrorism.

The arrest in Pakistan of Ramzi Binalshibh demonstrated that "we are relentless, we are strong, and we're not going to stop," President Bush said at Camp David, Md. "One by one we're hunting the killers down."

Germany dropped its request for the extradition of Binalshibh on Sunday, opening the way for the suspected Sept. 11 plotter to be handed over to the United States after his arrest last week by U.S. and Pakistani intelligence.

Interior Minister Moinuddun Haider told The Associated Press on Sunday that Binalshibh and the others had "done nothing wrong on our soil" and that if another country wanted them "they will be sent there."

Haider also said there was no doubt that the Binalshibh was among those taken into custody in raids here Tuesday and Wednesday, despite claims to the contrary by an Islamic militant Web site in Arabic.

Earlier, the Pakistanis had refrained from publicly confirming his identity because of uncertainty over the name of his father, information routinely used in the Middle East a means of identification.

Haider said Binalshibh and the others were still in Pakistan and that Pakistani and U.S. officials were discussing details of his extradition to the United States.

On Sunday, President Bush's national security adviser made clear the United States wants custody of him.

"Oh, we will be working with the Pakistani officials to make certain that he gets to the right place," Condoleezza Rice said in a broadcast interview. "There's no doubt that the United States will want to have access to him and to have him, because this is an important breakthrough."

The New York men, all in their 20s and of Yemeni descent, appeared in a Buffalo courtroom Saturday in handcuffs and shackles and were charged with unlawfully providing material support and resources to foreign terrorist organizations.

The judge entered a "not guilty" plea for each and ordered the men jailed until a detention hearing Wednesday.

Officials said the discovery of the terrorist cell was connected to information that also prompted the Bush administration to raise America's terror alert to "code orange" — the second-highest — on the eve of the attacks one-year anniversary.

The investigation into the Lackawanna cell began in early summer 2001, about the time records say the men returned from Afghanistan, and the communications and other activities surrounding the cell intensified this month, said Michael Battle, U.S. attorney for western New York.

"It seemed from all indications that the activity of these five individuals began to move in a number of different directions," Battle said Sunday. "The evidence pointed us, more importantly, to a particular time, which was this past few days, to make the arrest rather than something particular happening."

He wouldn't give specific details but said the arrests were big for law enforcement, particularly when investigations had been tracking similar activity in Detroit and Seattle.

"One of the things that makes this crew somewhat unique is that they're American-born citizens. That tells us a little bit more about what's going on in our country," Battle said.

According to the criminal complaint unsealed by the judge Saturday, the five New York men — Shafal Mosed, 24; Faysal Galab, 26; Sahim Alwan, 29; Yasein Taher, 24; and Yahya Goba, 25 — live within a few blocks of each another in Lackawanna and trained together at a camp in Afghanistan.

"They worked together, they socialized together, they lived within blocks of each other," said Ahearn. "It's a trained group of individuals that were trained in Afghanistan. It's an al Qaeda-trained cell."

FBI Special Agent Edward J. Needham wrote in the complaint that unindicted co-conspirators told him Goba, Alwan, Mosed and Taher attended al Qaeda's al-Farooq terror training camp near Kandahar, where they were trained to use Kalashnikov assault rifle, handguns and long range rifles.

During the training camp, the men were lectured on "Jihad (holy war), prayers and justification for using suicide as a weapon," according to Needham's affidavit.

It was the same camp John Walker Lindh attended, but officials declined to say if Lindh assisted with the investigation. Battle said it appeared the men and Lindh were together at the camp at some point.

U.S. authorities also hope to soon arrest the three co-conspirators, FBI Agent Stan Borgia said Sunday. He said the three, who were not named, are not in the United States and the government was working with "key foreign partners" in their cases.

The five men arrested in Buffalo said little in court Saturday, quietly answering only "yes" or "no" when U.S. Magistrate H. Kenneth Schroeder asked if they could afford lawyers.

William Clauss, a federal public defender assigned to represent Goba, said he had just met his client and couldn't comment.

"First step of course is to try to get them out of jail. We'll be contacting the family members and friends and I'm sure we'll be able to make a good presentation on Wednesday," Clauss told CBS News.

Joseph Latona, an attorney representing Galab, said his client is "hanging in there."

"He really has no choice. The government has the absolute right to have him detained until Wednesday," Latona said. "We'll confront the situation when we get back in the court on Wednesday."

Four of the five men were arrested Friday night after federal agents raided several houses and a social club in Lackawanna. Galab was arrested Friday morning.

Relatives of the men denied they were involved with al Qaeda.