U.S. counterterrorism officials say Lebanon-based Hezbollah terrorists remain a threat to the survival of Lebanon's government, Israel's security, and regional stability following its month-long war with Israel. The officials told Congress Thursday that Hezbollah has an increasing global reach and is capable of harming U.S. and other western interests around the world.

Hassan Nasrallah

The 34-day war between Hezbollah and Israel was triggered when Hezbollah fighters crossed into Israel, kidnapping two Israeli soldiers and killing eight others.

Israel responded with a military offensive intended to destroy Hezbollah's rockets, weaken its fighters and diminish its threat to Israel's security. But just last week, Hezbollah's leader, Hassan Nasrallah, told a rally of hundreds of thousands of supporters in Beirut, that his organization was as strong as ever and still had an arsenal of 20,000 rockets capable of striking Israel.

Frank Urbancic is a counterterrorism official at the U.S. State Department. He says Hezbollah is a capable terrorist organization with a growing reach.

"We could think of it perhaps as almost an octopus, with its head in southern Lebanon and tentacles moving around the world," said Frank Urbancic.

In the Middle East, Urbancic says Hezbollah is interested in expanding its links to other terrorist organizations and has so far succeeded in the Palestinian territories.

"Hezbollah has supported terrorist activities in the Palestinian territories since at least 2000, by providing financial, training and logistical support to Palestinian Islamic Jihad and other Palestinian terrorist groups," he said.

Hezbollah's growing reach, the officials say, is due in large part to the support it receives from its biggest backers - Iran and Syria - who provide Hezbollah with money, arms and training.

Counterterrorism officials are also concerned that Hezbollah is looking to expand into Central and South America, where the group's supporters and sympathizers are involved in drugs and arms trafficking, money laundering and other criminal activities.

Hezbollah was founded in 1982 as a response to Israel's invasion and occupation of Lebanon. Prior to the September 11, 2001, terrorist attacks on the United States Hezbollah was responsible for more American deaths than any other terrorist group.

The officials testified that they do not think Hezbollah is planning any terrorist operations in the United States right now, but they warn that the group operates in the United States to raise money to support its terrorist activities.

John Kavanagh is a counterterrorism official with the Federal Bureau of Investigation:

"Within the United States, Hezbollah associates and sympathizers have engaged in a wide range of criminal activities to include money laundering, credit card fraud, immigration fraud, food stamp fraud, bank fraud and narcotics trafficking," said John Kavanagh.

The officials warn that Hezbollah remains a highly organized and well-trained organization with funding from many sources. They say it is capable of acting against U.S. interests on several fronts and on several continents.

The officials said close cooperation with U.S. allies is the most effective way to counter the Hezbollah threat.