The FBI said it began investigating 19-year-old Somali immigrant Mohamed Mohamud in August 2009 and learned he planned to bomb the popular tree lighting ceremony at Portland's Pioneer Courthouse Square minutes before it took place at 6 p.m. Friday.
Working with state and local police departments, the FBI allowed the plan to park a bomb-laden van near the square to proceed, but with a harmless dummy bomb, The (Portland) Oregonian reported Saturday.
Mohamud was arrested as he tried to detonate the device with a cell phone, Oregon U.S. Attorney Dwight Holton said.
"This defendant's chilling determination is a stark reminder that there are people -- even here in Oregon -- who are determined to kill Americans," Holton said.
The arrest affidavit alleges Mohamud told undercover agents he thought were helping him that he wanted to see a "huge mass that will ... be attacked in their own element with their families celebrating the holidays."
He is due to appear in court Monday and could face life in prison and a $250,000 fine if convicted, the report said.