President Bush has frozen the assets of a U.S. based charity that he says helps fund the militant Palestinian group Hamas. The action follows Hamas claims of responsibility for suicide bombings in Israel that killed 25 people in Israel.

Authorities raided the offices of the one of the largest Muslim charities in the United States, seizing records and freezing the assets of the Holy Land Foundation for Relief and Development.

President Bush says it is part of U.S. efforts to disrupt the finances of international terrorists, in this case the militant Palestinian group Hamas. "Hamas has obtained much of the money that it pays for murder abroad right here in the United States. Money originally raised by the Holy Land Foundation," he said.

A statement from the Texas-based foundation says it has never provided funds, services or any form of support to Hamas or any other group that sponsors terrorism.

Treasury Secretary Paul O'Neil has said the evidence against the Holy Land Foundation is overwhelming. He said shutting the group down is another advance against the financiers of terror. "The Holy Land Foundation masquerades as a charity, while its primary purpose is to fund Hamas. This is not a case of one bad actor stealing from the petty cash drawer and giving stolen money to terrorists. This organization exists to raise money in the United States to promote terror," Mr. O'Neil said.

The foundation raised $13 million last year as a tax-exempt religious charity. President Bush says he is confident most of the donors had no idea how their money was being used. "Money raised by the Holy Land Foundation is used by Hamas to support schools that indoctrinate children to grow up into suicide bombers. Money raised by the Holy Land Foundation is also used by Hamas to recruit suicide bombers and to support their families," he said.

Attorney General John Ashcroft has said raids on Holy Land Foundation offices in Texas, California, New Jersey and Illinois are part of an ongoing investigation to tighten the net around terrorist finances.

"By freezing the financial apparatus of Hamas, we signal that the United States of America will not be used as a staging ground for the financing of those groups that violently oppose peace as a solution to the Israeli-Palestinian conflict. We will not tolerate it any more than we will tolerate the financing of groups that on September 11 attacked our homeland," Mr. Ashcroft said.

The administration has already frozen more than $60 million worth of assets linked to Osama bin Laden and his al-Qaida terrorist group. The move against Hamas supporters also included action against two financial groups based in the Palestinian-controlled West Bank.