Spy-for-spy charges fuel enduring Palestinian feud

GAZA (Reuters) - The Palestinian Islamist group Hamas said Wednesday it had broken up an espionage network of the rival Fatah movement which was plotting to sabotage security in the Hamas-run Gaza Strip.

Hamas's spying-and-sabotage allegation follows similar charges by Fatah in the West Bank against Hamas, as the two rivals once again failed to bridge deep differences over how to deal with Israel and advance Palestinian aspirations.

Gaza Interior Ministry spokesman Ehab al-Ghsain said Fatah agents aimed to sow "security chaos," on the orders of their superiors in the Israeli-occupied West Bank, where the Fatah dominated Palestinian Authority holds sway.

They had collected information about Hamas leaders and fighters and sent it on to the Fatah-run security forces in the West Bank "to use in any future war" against the Palestinian resistance in Gaza, he said in a statement.

Al-Ghsain said the cells were dismantled but some agents had escaped to the West Bank, via Israel, which controls the borders of the Gaza Strip.

Fatah denied the charges. "These are totally unfounded allegations," said spokesman Fahmi al-Zarir.

Saturday, Palestinian security forces loyal to President Mahmoud Abbas, the Fatah leader, said they had seized large sums of cash in West Bank homes from men they accused of plotting to kill government officials.

A senior security official, speaking anonymously, said men known to have connections to Islamist Hamas had been arrested at a number of locations in the West Bank over the past weeks and some $8.5 million in cash had been seized.

Israeli forces battered the Hamas-run Gaza Strip for three weeks at the beginning of this year in a major offensive they said was intended to force the Islamists to stop firing rockets into Israel. The Palestinians say 1,400 people were killed. Israel said 13 of its citizens lost their lives.

Tension between Hamas and Abbas's Western-backed, secular Fatah faction exploded two years ago when Hamas took control of the Gaza Strip in a brief but bloody civil war. Unlike Abbas, Hamas, which won a parliamentary election in 2006, refuses to recognize Israel or renounce violence against it.

For months, the two sides have tried to agree a power-sharing deal in Egyptian-brokered talks. After they missed Egypt's July 7 deadline for an agreement, the Egyptian mediators have now set a July 28 target date.

(Reporting by Nidal al-Mughrabi and Ali Sawafta, writing by Douglas Hamilton, editing by Alastair Macdonald)