SAN FRANCISCO, Dec 25: Encouraged by a recent Chicago court decision ordering three American Muslim charities to pay 156 million dollars to parents of a teenager killed in a suicide bombing in occupied Jerusalem , a group of 117 Americans whose relatives have been killed or injured in Palestinian attacks in Israel have sued the Jordan-based Arab Bank, claiming that money transfers performed by the bank violate US criminal and civil laws.

The plaintiffs have charged the bank with illegally funnelling funds from Islamic foundations to "recognized terrorist organizations", through its Madison Avenue branch in Manhattan.

Recipients of the funds allegedly include Hamas, Al Aqsa Martyrs Brigade and Islamic Jihad, the plaintiffs alleged. Washington has designated the four groups as terrorist organizations.

The 149-page lawsuit, filed at the US District Court for the Eastern District of New York, contends that the Jordan-based Arab Bank knew or should have known that its accounts were being used by Palestinian militant organizations to pay the families of suicide bombers who blew up civilian and military targets in Israel and the occupied territories.

A spokesman for Arab Bank, the largest and oldest private-sector banking network in the Middle East, denied the allegations. "Arab Bank asserts unequivocally, and above all else, that it deplores and condemns terrorism in all its forms, and is saddened by the consequences of it," said Kevin Walsh, a lawyer with Winston & Strawn of Chicago. "The accusations being brought against the bank, as we understand them, are entirely false."