The Zetas cartel has been battling rival drug gangs for control of northeast Mexico [EPA]

A founding member of Mexico's notorius Zetas drug cartel has been arrested by federal police.

Flavio Mendez Santiago, also known as "El Amarillo" or "The Yellow One," was arrested along with a bodyguard outside Oaxaca City on Tuesday.

He was in charge of operations in the states of Oaxaca, Chiapas and Veracruz, and controlled the smuggling of undocumented Central and South American migrants to the northern states of Nuevo Leon and Tamaulipas, on the border with Texas, Ramon Pequeno, the federal police anti-drug chief, said.

The Zetas are suspected of being involved in the disappearance of more than 40 Central American migrants in Oaxaca last month. The travellers were last seen on December 16 near the city of Ixtepec along the transit route for thousands who ride northbound goods trains.

The gang is also blamed for massacring 72 migrants in August in the northern state of Tamaulipas.

Beheaded rivals

Mendez Santiago, a former soldier, was recruited by the Gulf cartel in 1993 and later served as bodyguard for then-leader Osiel Cardenas Guillen.

Formed from a small group of elite soldiers based in Tamaulipas who deserted to work for the Gulf drug cartel, the Zetas earned their notoriety for brutality by becoming the first to publicly display their beheaded rivals.

The Zetas began gaining independence from the Gulf cartel after Cardenas Guillen's extradition to the US in 2006 and finally split from their former bosses last year. They have since been fighting for control of northeast Mexico, the traditional home base of the Gulf cartel.

On Tuesday, five mutilated bodies were found outside the city of Monterrey in Nuevo Leon, the latest apparent victims of the battle between rival gangs.

The five dead men, their arms and legs chopped off, were dumped on a street in the town of Montemorelos south of Monterrey just before dawn, police and witnesses said, part of an escalation of killings that has left at least 23 people dead in two days.

"In this toll of 23 deaths ... it is clear this violence is being unleashed by warring criminals," Jorge Domene, the security spokesman for the Nuevo Leon government, said.

More than 34,000 people have been killed in drug violence across Mexico since Felipe Calderon, the president, sent in the army to fight the cartels in 2006.