JERUSALEM —  Police on Tuesday arrested the leader and 13 members of Israel's Islamic Movement (search) on charges they funneled millions of dollars to the Hamas (search) group, responsible for scores of suicide bombings.

The arrests signaled a further downturn in relations between the Israeli government and the country's 1.2 million-strong Arab minority.

Israeli Arabs have long complained of systematic discrimination by the authorities, and tensions have been running especially high since police killed 13 Arabs in anti-government riots in October 2000.

The Islamic Movement is the largest Arab organization in Israel. It has split into a more pragmatic branch that participates in Israel's political life, and a more radical branch that has come out in support of Hamas, a Palestinian group operating in the West Bank (search) and Gaza Strip (search).

The Israeli police minister, Tzahi Hanegbi, alleged Tuesday that the so-called northern branch of the Islamic Movement "inflamed the bonfire of terrorism."

The Islamic Movement had no immediate comment. Hamas said the Islamic Movement provided humanitarian assistance to Palestinians, and that it -- Hamas -- had no ties to the Israeli Arab group.

The arrests capped a two-year investigation and were carried out early Tuesday, on a Muslim holiday marking the birthday of Prophet Muhammad. Police and agents of the Shin Bet security service arrested the leader of the northern branch of the Islamic Movement, Sheik Raed Salah, and 13 other members of the group.

In the Arab town of Umm el-Fahm in northern Israel, security forces raided the office of the Al Aqsa Association, a charity linked to the Islamic Movement, and confiscated documents, the Haaretz daily said.

The detainees were to be brought before a Tel Aviv court later Tuesday for a remand hearing. Police seek to keep them in custody until the end of the investigation.

Hanegbi, the police minister, said the money sent to Hamas was collected by the Islamic Movement under the guise of charity.

The suspects "have been working consistently for years to bring in massive amounts of money for activities that ... help terror, activities of Hamas in West Bank and Gaza Strip," he told Israel Radio.

Hanegbi said it made little difference whether the money was used for buying explosives or was given to families of suicide bombers. "Terror cannot exist without a financial infrastructure," he said.

Hamas said in a statement that the arrests were "a new escalation against Muslims and Arabs in occupied Palestine."

Since the current round of Israeli-Palestinian fighting began in September 2000, Hamas and the smaller Islamic Jihad group have carried out 89 suicide bombings that have killed more than 300 Israelis. Only one of the bombers was an Israeli Arab. However, in several of the attacks, Arab citizens of Israel provided assistance, police have said.

Arabs make up about one-sixth of Israel's 6.5 million people.