TEGUCIGALPA, HONDURAS -- Reports of Honduran involvement in the drug-smuggling network of Colombia's Medellin Cartel have thrown a spotlight on a wealthy Honduran "businessman" wanted by U.S. authorities in connection with the murder of an American narcotics agent and other drug-related crimes.

U.S. officials say that Juan Ramon Matta Ballesteros was a key liaison between the Medellin Cartel and a Mexican drug-smuggling ring that carried out the torture and murder of U.S. Drug Enforcement Administration agent Enrique Camarena Salazar in Mexico in 1985. But Matta has been beyond the reach of U.S. law since he returned to Honduras last year because the Honduran constitution specifically prohibits the extradition of Honduran citizens.

In view of the attention on Matta, however, some Honduran officials have hinted they might support a change in the law to allow his extradition. Matta broke a long silence this week to deny any connection to the Medellin Cartel. In an interview at his office near Tegucigalpa's airport, he charged that U.S. agents have tried four times to kidnap him. He called charges of his involvement in the killing of Camarena "pure lies."

Matta said he was a legitimate businessman with interests in tobacco, cattle and construction.

The controversy surrounding Matta follows several months of drug arrests in Honduras that show the Central American nation to be a major transshipment point for Colombian cocaine bound for the United States. Last November, in the largest single cocaine seizure in the United States, more than 8,000 pounds of the drug were found in hollowed furniture that had been packed in Honduras.

It is not known if Matta was involved in that shipment, but U.S. officials outside Honduras have said he is still active in the drug trade and has been working with corrupt Honduran officials.

At the same time, U.S. officials have praised the Honduran government for its help in investigating cocaine trafficking.

Matta, who said he has been indicted in the United States on four drug-related counts, returned to Honduras secretly in 1986 after escaping from a Colombian jail. He then spent several months in a Tegucigalpa prison while he cleared himself of a decade-old drug-related murder charge.

He refused to detail his Colombian escape or his return to Honduras, but denied reports that he paid a $3 million bribe to get out of jail. He also denied reports in Honduras that he is worth $2 billion. He said his wealth was the result of luck and business acumen.

That acumen has embarrassed the U.S. Embassy in Tegucigalpa. Officials recently discovered they were renting at least two houses from Matta for embassy personnel. Matta claimed he has rented five houses to the U.S. government including his present home. He said American soldiers lived in his home from 1984 to 1986 and that the embassy paid him $3,500 a month.

An embassy spokesman denied that the mission rented Matta's home, but acknowledged renting two houses controlled by Matta's sister-in-law. The spokesman said the embassy would allow the leases on the houses to expire.