Updated

An Iranian officer accused of smuggling powerful roadside bombs into Iraq was arrested Thursday in northern Iraq, the U.S. military said.

The arrest could add to tensions between Washington and Tehran already strained by the detention of each other's citizens as well as U.S. accusations of Iranian involvement in Iraq's violence and Iran's disputed nuclear program.

The military said the suspect was a member of the Quds force — an elite unit of Iran's Revolutionary Guards — and was seized from a hotel in the Kurdish city of Sulaimaniyah.

Two other Iranians were detained in the raid but later released, a Kurdish official said.

The Iranian officer was allegedly involved in transporting roadside bombs, including armor-piercing explosively formed penetrators, or EFPs, into Iraq, according to a military statement. It said intelligence reports also indicated he was involved in the infiltration and training of foreign fighters in Iraq.

Officials have said the Bush administration is expected to soon blacklist the Quds force as a terrorist organization, subjecting part of Iran's vast military operation to financial sanctions. The move would be in response to Iranian actions in Iraq and elsewhere.

Brig. Saif al-Den Ahmed, the city's security chief, said the Iranian was arrested during a pre-dawn raid by U.S. troops at the Sulaimaniyah Palace Hotel.

The local Kurdish-led government was not notified of the operation in advance, he added.

A Kurdish official in the city, who spoke on condition of anonymity because of the sensitivity of the issue, said that initially three Iranians were arrested but two were later released.

The three included the mayor of Qasr-e Shirin, a city close to the Iraqi border; the head of an office in the city that gives permits to Iranian merchants traveling to northern Iraq; and a merchant, the official said.

The official, from the Patriotic Union of Kurdistan, or PUK, said the person kept in custody was the head of the merchant permits office. He did not identify any of the Iranians.

Detentions of Iranians remain a sensitive issue following the brief August detention by U.S. troops of eight Iranian nationals in a central Baghdad hotel and the January arrest of five Iranians during a U.S. raid in the northern city of Irbil.

While the eight Iranians were promptly released in Baghdad after it was established they were on an official visit to Iraq, the other five remain in custody.

U.S. authorities have said the five included the operations chief and other members of the Quds force. Iran has consistently denied U.S. allegations it is arming and training fighters in Iraq, and insists the five were diplomats in Iraq with permission of the government.

The Iraqi government, which is backed by the U.S. but closely allied to Iran, has been trying to get its two largest allies closer, in hopes that U.S.-Iranian cooperation could reduce violence in the country.