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Police sappers disarmed a bomb in a car outside Haifa's Lev Hamifratz shopping mall last night, thwarting a potential terror attack in the northern coastal city.

Security forces set up roadblocks, searching cars for suspects and forcing traffic in the area to nearly a standstill.

Police said the car holding the explosive, which weighed dozens of kilograms, belonged to an Arab woman from East Jerusalem. But they added it might have been stolen and that they had no prior intelligence on the vehicle.

An organization calling itself the Galilee Freedom Fighters claimed responsibility, but security forces doubted the claim, saying they were unfamiliar with a group of that name currently operating in Israel.

"We are conducting a search for a terrorist, if it is indeed a terrorist," said the commander of the police's Northern District, Shimon Koren. "We are searching the entire area from Haifa to Acre and Nahariya."

Security forces were called to the parking lot after the mall's security guards heard a small explosion. Sappers said part of the device had gone off prematurely and another had failed to detonate.

"It's important to note that the car was parked in the outer car park and not underground, which means it was not checked by mall security," a police officer said.

Five years ago two Israeli Arabs who claimed to be members of a group called Galilee Freedom Fighters were convicted of murdering Israel Defense Forces soldier Oleg Shaichat. But security forces now believe that organization is defunct.