Fighters with the Lebanese Shiite Hezbollah party parade in a suburb of Beirut in May 2019
Fighters with the Lebanese Shiite Hezbollah party parade in a suburb of Beirut in May 2019 AFP / Anwar AMRO

The United States on Thursday announced sanctions in Lebanon and Oman aimed at shutting down financing to the Iranian-backed group Hezbollah and the Palestinian Hamas militants.

Powerful US financial sanctions were imposed on the Jammal Trust Bank in Lebanon, which was accused of acting as a key financial institution for Hezbollah, which opposes US ally Israel.

They also targeted individuals in Oman who allegedly act as middlemen to funnel cash from Iran's elite Quds Force to Hamas in Gaza.

The US Treasury Department "is targeting Jammal Trust Bank and its subsidiaries for brazenly enabling Hezbollah's financial activities," including sending payments to families of suicide bombers, Sigal Mandelker, under secretary for terrorism and financial intelligence, said in a statement.

He said the Oman-based financiers "funneled tens of millions of dollars... to Hamas for terrorist attacks originating from the Gaza Strip."

The sanctions mean that any link with US citizens or institutions is no longer allowed, which is likely to severely curtail activities.

In Beirut, the Association of Banks in Lebanon voiced "regret" over the US move -- while insisting all funds deposited with Jammal Trust Bank were safe and stressing the ability of the country's central bank to remedy the situation if need be.

Senior US administration officials, speaking on condition of not being identified, told reporters that the two actions were above all meant to send a signal.

The bid to squeeze Jammal "should be seen as a warning shot that Hezbollah and its Iranian puppet masters should keep their hands off Lebanese financial institutions," one official said, calling this part of a strategy to "choke off every last avenue of funding."

Although Jammal is only a modest sized bank in Lebanon, it is the "bank of choice" for Hezbollah, another official said.

A third senior official called the sanctions a reflection of the "gloves off approach" by President Donald Trump against Hezbollah.

"We will continue to target individuals and entities involved in financing and providing support to Hezbollah while working closely with the Central Bank of Lebanon and other Lebanese institutions which work to preserve the integrity and stability of Lebanon's banking system," the State Department said.