Israel has accused a representative of the US-based Christian relief group World Vision of funnelling millions of dollars in aid money to Hamas fighters in Gaza, charges that the group denies.

Briefing reporters on Thursday, a senior Israeli security official said that Mohammad El Halabi, World Vision's manager of operations in Gaza, had siphoned off about $7.2m a year - around 60 percent of the organisation's Gaza funding - to pay Hamas fighters, buy arms, pay for its activities and build fortifications.

Halabi, a Palestinian who has run World Vision's Gaza operations since 2010, was arrested on June 15 while crossing the border into the enclave, which is under the de facto rule of Hamas. He was charged at a court in Beersheba on Thursday.

"Money was used to fund Hamas and pay armed-wing fighters, and food and health packs intended for Gaza residents were also given to Hamas operatives, rather than to their intended recipients, the poor and meek of Gaza," the Israeli official said. Halabi was also accused of buying arms for fighters in Egypt's Sinai peninsula, which also borders Israel.

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"Based on the information available to us at this time, we have no reason to believe that the allegations are true," World Vision said in a statement, adding that it conducts regular internal and independent audits and evaluations to ensure aid reaches intended beneficiaries.

"We will carefully review any evidence presented to us and will take appropriate actions based on that evidence," the organisation added.

Israel had previously maintained a gag order on the case and it was not immediately clear if Halabi was assigned a lawyer or how he had responded to the charges in court.

Hamas spokesman Sami Abu Zuhri, speaking in Gaza, said the group had "no connection to [Halabi] and therefore, all Israeli accusations are void and aim to suppress our people".

Hamas also denied any links to fighters in Sinai.

Source: Agencies