The Ofer Brothers Group did not break any laws in the Iranian tank affair, former Mossad chief Meir Dagan said on Wednesday, saying that he did not know of any boycott on Iran.

Last week the U.S. State Department announced sanctions on the Israeli business group and a Singapore-based subsidy, Tanker Pacific, for their roles in a September 2010 transaction that provided Islamic Republic of Iran Shipping Lines with a tanker.

The Ofer group has denied the allegation, but no Israeli government agency has come forward to confirm that the state could vouch for it.

Sources close to the group say they have contacted the defense and foreign ministries to help them remove the Ofer Bros. Group from the U.S. blacklist. This claim could also not be confirmed by official Israeli sources.

Earlier this week, Dagan, commenting on the Ofer affair, said that he felt the media coverage blew the issue out of proportion.

Speaking on Wednesday, the former Mossad chief said that he was "not the Ofer family's defender, I am not their representative, I'm just concerned about the State of Israel."

"There's no law saying you can't dock in Iran. I'm worried about the thousands of Ofer family workers who could get hurt by the issue and their livelihood means a lot to me," Dagan said, adding: "They did not trade with Iran. They're a transportation company. And besides, there's no boycott on Iran."

On Tuesday, a discussion by the Knesset Economic Affairs Committee on the Ofer Brothers' dealings with Iran was halted after 15 minutes because of warnings from the defense establishment that they might damage the State of Israel, an Israeli source close to the Ofer family has told Haaretz.

Committee chairman MK Carmel Shama-Hacohen suddenly adjourned the meeting after being handed a note, the content of which he declined to divulge.

According to the source close to the Ofer family, who asked to remain anonymous because of the sensitivity of the matter, Israeli officials have been assisted in a number of cases in recent years by the Ofer family's business activities in the Persian Gulf for "national needs."

"It's no secret that the State of Israel sometimes seeks the help of business people," the source said. "Some agree and some don't."

The source said that apparently "someone in the defense establishment woke up and understood that the meeting MK Carmel Shama-Hacohen wanted to hold would have caused damage."

Both the Prime Minister's Bureau and the military censor denied requesting or recommending that Shama-Hacohen adjourn the meeting.