BERN, Switzerland (AP) _ The sister-in-law of Mexico's former president has been arrested in connection with a huge drug operation, Swiss officials disclosed Friday, adding a dramatic new element to a scandal that includes murder and high-level political intrigue.

Paulina Castanon and her brother were arrested on Nov. 15 as they tried to make withdrawals from Geneva bank accounts containing $84 million, using papers that carried her husband's photo but a phony name, Mexican prosecutors said Thursday.

Without mentioning any names, Swiss authorities made it clear on Friday that the arrests were tied to drug running, and that the drug operations were enormous. Speculation in Mexico had suggested the Geneva money came from bribes.

The Swiss announcement is the latest twist in the scandal exploding around former President Carlos Salinas de Gortari.

His brother _ Paulina Castanon's husband, Raul Salinas de Gortari _ is in a maximum security jail west of Mexico City, charged with masterminding the September 1994 murder of Jose Francisco Ruiz Massieu, secretary-general of the ruling Institutional Revolutionary Party.

Carlos Salinas has not been implicated in the slaying, but Ruiz Massieu's own brother has _ accused of covering up for Raul Salinas. And like Raul Salinas, Mario Ruiz Massieu _ who once led Mexico's anti-drug efforts _ is said to have millions of dollars he couldn't have earned on the job.

Mexican prosecutors claim he has nearly $7 million in Texas bank accounts. He was arrested in the United States while en route to Europe earlier this year, and is being held while Mexico tries to have him extradited.

No clear motive has been established for the murder of Jose Francisco Ruiz Massieu. Some witnesses and prosecutors have suggested he had squabbled with Raul Salinas over business deals or over his divorce of Raul's sister. Mario Ruiz Massieu suggested his brother was killed because of his supposedly reformist ideas.

Raul Salinas, a longtime member of the party that has dominated Mexican politics for 66 years, had held the kind of high-ranking jobs that provide power and prestige. He has long been accused of shady business deals and he has been a favorite target of his brother's critics.

Some allegations have linked him to Mexico's drug kingpins, but he has denied having ties to narcotics traffickers.

In Switzerland on Friday, the federal prosecutor and the Office of Police Affairs issued a joint statement saying that two people were arrested Nov. 15 ``in connection with the financing of drug trafficking and laundering of drug money.''

The Swiss would not confirm the names of the two suspects arrested, but they said they were talking about the reports from Mexico about the arrests of Paulina Castanon and her brother.

Several bank accounts containing millions of dollars were frozen in Geneva and Zurich, and Swiss authorities are investigating several Mexican citizens, the statement said. Several houses were searched.

The investigation in Switzerland was being conducted in cooperation with U.S. and Mexican authorities, Swiss authorities said.

Dana Seely, spokeswoman for the U.S. Drug Enforcement Administration, would not comment on U.S. involvement with the investigation. ``This is an internal matter between the government of Switzerland and the government of Mexico,'' she said.

Prosecutors in Mexico said Paulina and Antonion Castanon were trying to use false papers bearing Raul Salinas' photograph but a different name, Juan Guillermo Gomez Gutierrez, to withdraw from accounts containing $84 million. The officials said they did not know how much the two were trying to withdraw.

Mexican officials said they had found Raul Salinas' photo and signature on applications for a birth certificate, driver's license, passport and property documents in the name of Juan Guillermo Gomez Gutierrez.

The comptroller's office said Raul Salinas declared ownership of 18 properties in February 1983 and 39 in May 1992, a period when he was generally in government service.

From January 1991 to April 30, 1992, he and his wife deposited the equivalent of $7.4 million in five bank accounts, according to a statement from the office.

Carlos Salinas left the presidency three months before his brother's arrest, and left Mexico in March, blamed by many for the economic crisis that had befallen the country.

Although he himself has not been linked to the Ruiz Massieu killing, he has been caught up in a web of suspicion cast over his whole administration. Earlier this year, he was forced to withdraw his candidacy for the prestigious post of director-general of the World Trade Organization.

Initial reports said Carlos Salinas had gone to the United States, but most recent reports put him in Canada. Cuban authorities on Thursday denied reports in the Mexican press that he had visited Cuba.