Relatives of American and Israeli victims of Palestinian attacks have filed an $875 million lawsuit in federal district court in Manhattan against the Amman-based Arab Bank.

The group alleges that the Jordanian bank has transferred funds to such insurgency groups as Hamas and Islamic Jihad.

The U.S. lawsuit was based on documents seized by the Israeli military in February 2004 from the Arab Bank branch in Ramallah. The plaintiffs said the documents pointed to a direct link between the Arab Bank and Hamas and Jihad in the West Bank and Gaza Strip.

The Arab Bank is one of the largest financial institutions in the Middle East, Middle East Newsline reported.

Jihad's website, www.palestineway.com, has provided the accounts of organizations linked to Arab Bank branches in such cities as Bethlehem, Gaza City and Jenin.

"The Jordanian-based banking institution with a branch in New York is knowingly administering the distribution of financial benefits to terrorists, the families of terrorists and foreign terrorist organizations as part of a scheme to encourage and facilitate acts of international terrorism." the suit, submitted on July 6, said.

The Arab Bank was said to be operated by Palestinian investors. The bank, however, has been regarded as a leading financial tool of the Hashemite kingdom of Jordan.

[On Monday, the Fatah-dominated Al Aqsa Martyrs Brigade claimed responsibility for the assassination of an Israeli judge outside his home near Tel Aviv. The judge, Adi Azar, had recently ordered the freezing of more than $10 million in PA funds to pay for damages to Israel's largest bus company from Palestinian insurgency attacks.]

The suit marked the latest attempt by relatives of Israeli and American victims to obtain financial compensation from Palestinian insurgency groups.

On July 12, the U.S. district court in Rhode Island awarded $116 million to the parents and children of an Israeli couple killed by Hamas insurgents in 1996. The court ordered the Palestinian Authority to pay the damages to Yaron Ungar and his wife, Efrat.

The U.S. court ruled that the PA and Palestine Liberation Organization provided a safe haven and operational base for Hamas to carry out the attack. In January 2004, the same court also ordered Hamas to pay a similar sum.

The PA had been represented by former U.S. Attorney General Ramsey Clark, while Hamas did not contest the suit. The suit was filed in the United States in 2000 under the Anti-Terrorism Act, the 1991 law that has enabled American victims of terrorist attacks abroad to seek damages in U.S. courts.