US authorites have implicated Beirut-based Lebanese Canadian Bank (LCB) in a money laundering scheme involving Lebanese militant group Hezbollah.

About $150m allegedly generated through illegal activities has been seized by the authorities, who say LCB held the funds on behalf of Hezbollah in an American bank account.

Preet Bharara, the US attorney in Manhattan, and Michele Leonhart, chief of the Drug Enforcement Administration (DEA), say the funds were transferred into US currency in a sophisticated money laundering scheme.

Prosecutors claim LCB, along with Lebanese businesses Hassan Ayash Exchange Company and Ellissa Holding Company, were involved in channelling funds from Beirut to the US for the purchase of used cars, which were subsequently shipped to Africa. Profits from the sale of these vehicles were sent back to Lebanon.

In 2011, DEA officials claimed LCB permitted Hezbollah-related entities to conduct massive cash transactions, in some cases as much as $260,000 a day. The agency estimates that from January 1, 2007 to early 2011, “at least $329m was transferred by wire from LCB, the Hassan Ayash Exchange Company, the Ellissa Exchange Company and other Lebanese financial institutions, including Middle East and Africa Bank, the Federal Bank of Lebanon and Blom Bank, to the US for the purchase and shipment of used cars”.

“As we alleged last year, the Lebanese Canadian Bank played a key role in facilitating money laundering for Hezbollah-controlled organisations across the globe,” Leonhart said in a statement.

“Our relentless pursuit of global criminal networks showed that the US banking system was exploited to launder drug trafficking funds through West Africa and into Lebanon.”

Hezbollah released a statement denying the charges, which it described as “another attempt to tarnish the image of the resistance in Lebanon”.

An LCB spokesperson was unavailable for comment at the time of press.