Police said Sunday they had raided and arrested workers and an executive at two Ramat Gan companies, suspected of helping channel funds to the Palestinian militant groups Hamas and Islamic Jihad.

Lawmen raided offices of Shintrako Ltd. and Mayan Customs Brokers and
International Forwarding Sunday in the Tel Aviv suburb, police said in a statement.

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Police arrested the general manager of Shintrako and other workers of the two companies, the statement said.

"The companies are suspected of funding Hamas and Islamic Jihad through a company they did business with in the Gaza Strip," read the statement.

Shintrako had been warned not to work with the company but found ways to help it get around trade restrictions imposed by Israel, the release said.

Police have reported an increase over the past year in the flow of clandestine finance to Palestinian militant groups squeezed by a financial blockade imposed by international aid donors since Hamas last year won parliamentary elections and control of the Palestinian government.

"These funds are used as fuel to ignite terror and they allow these
organizations to preserve and expand their organized infrastructure," the
police statement said.