The Justice Ministry has informed the U.S. District Court in New York that Israeli justice officials have yet to finalize their position as to the testimony of former defense officials in a suit filed against the Bank of China related to a 2006 terror attack.

Senior congressmen have recently slammed Israel's position in the matter, adding that they tried to voice their protest but Prime Minister Benjamin Netanyahu did not answer their phone calls.

Details of the affair were first published in Haaretz last month.

Daniel Cantor Wultz, from Weston, Florida, was 16 when he was killed in a suicide attack in Tel Aviv in 2006, perpetrated by a Palestinian terrorist from the Islamic Jihad organization. Wultz's family filed a huge compensation suit against the Bank of China arguing that funds channeled through the bank served terrorist cells of Hamas and the Islamist Jihad in the Gaza Strip.

The family has already won a similar case, when it demanded in a U.S. federal court $320 million from the governments of Iran and Russia due to their support of Syria.

Israel, which approached the Wultz family and suggested filing the suits, promised that it would supply documents and affidavits by former senior Israeli defense officials, including Uzi Shaya, testifying that the Chinese were specifically warned as to the use of these specific bank accounts a year prior to the terror attack.

Meanwhile, the Chinese government has applied immense pressure on Netanyahu to withdraw his support of the suit. On Friday, Yedioth Aharonoth reported that following Netanyahu's visit to China two months ago, it was decided that Israel should indeed withdraw its support of the suit and not supply the testimonies and documents.

Speaking to Haaretz on Monday, Daniel Wultz's parents said they have not yet been informed about the Israeli change of heart.

"The first time we found out about the change [in the Israeli position] was when the Chinese somehow hinted that we don’t have a witness and it [aroused] suspicion that they know what we don’t," Tuly (Yekutiel) Wultz said. "We are not only surprised, not only disappointed," Wultz added. "We are worried about the implications and ramifications that this kind of decision not to allow the testimony will have on the fight against terror. It is a blow to the fight against terror."

Daniel's mother, Sheryl Cantor Wultz, added: "Netanyahu addressed the United Nations here, and said Israel has to be a light to other nations. I don’t understand how he can get out there and say this and not let the truth come out and try to stop terrorism? How does he expect to be taken seriously as a leader?"

Israel's conduct in the process has also angered the judge in the case, Shira Scheindlin, as well as pro-Israel congressmen, both Democrats and Republicans. U.S. Congressman Eric Cantor, Republican from Virginia, the House majority leader, is a cousin of Sheryl Cantor Wultz.

The deputy director of the international department of the State Prosecutor's office, Yitzhak Blum, wrote in a July 12 letter to judge Scheindlin that the Justice Ministry is still examining "the essential and procedural aspects of the judge's letter" that demanded clarifications concerning the postponement of Shaya's testimony. "We will inform you of our position once the examination is completed," Blum wrote.

The postponement could come with costs. The judge and the plaintiffs might issue a Habeas corpus against Israeli officials if Israel should decide to withdraw its support of the Wultz family's suit. Such a move might prevent several senior Israeli officials such as head of the National Security Council Yaakov Amidror and former ambassador Michael Oren, who were both involved in preparing the case, from visiting the U.S., where they might be forced to testify.

At the same time, congressman are infuriated with Israel due to what they see as succumbing to Chinese pressure and shirking the war on terror, defining Israeli conduct as sabotaging U.S. justice procedures. Several senior pro-Israeli congressmen turned last week to Ambassador Michael Oren, and expressed their protest as to "the Netanyahu government zigzag" in the matter.

"I don’t have to be in Netanyahu's shoes," Tuly Wultz told Haaretz on Monday. "I know one thing – Israel failed to protect us when we were there in 2006. And when they came and wanted our help in filing the lawsuit and stopping of terrorists, we gave our hearts and souls to this. And years later, after there was nothing was wrong, no national or security problem – all of a sudden, right after the trip to China, there is a security problem. We were not born yesterday."

At least two congressmen, who usually hold close contacts with Netanyahu, complained that he doesn't answer their calls. On Friday another hearing is expected to take place in the New York Court, which is expected to focus on the Chinese government's conduct in the matter, but will probably also deal with the court's request to clarify the Israeli position as to the officials' testimony.

"How will Israel look when we win the case and not only without Israeli help but with Israel trying to sabotage that?" Tuly Wultz said.

“Since 2006, the Wultz family has had to deal with this real life nightmare of losing their son in a horrific and unwarranted terrorist attack while on vacation in Israel.  I am hopeful that the government of Israel can work with the Wultz family to hold accountable those responsible for this horrific crime as well as those involved in terrorist financing of these senseless acts of violence. I will continue to work with the Wultz family as they continue to seek justice for their son, Daniel,” said Congresswoman Ileana Ros-Lehtinen.