WASHINGTON (Reuters) - A Pakistani-born man accused of aiding militants in the 2008 Mumbai attacks is set to go on trial in Chicago next week in a legal battle that may worsen strained relations between the United States and Pakistan.
The trial follows the U.S. killing of Osama bin Laden in Pakistan in an operation that raised questions about whether Pakistani authorities knew of the al Qaeda leader's presence and about their commitment to fighting militant groups.
Pakistani-born Tahawwur Hussain Rana, who has Canadian citizenship, goes on trial on Monday in U.S. federal court for allegedly helping an American named David Headley find targets in Mumbai and in Denmark for the Pakistani militant group Lashkar-e-Taiba (LeT).
Long an enemy of India, the group killed 166 people, including six Americans, in an attack in Mumbai in 2008. It has been closely tied to Pakistan's Inter-Services Intelligence Agency (ISI). Pakistan's government banned LeT and froze its assets in 2002.
U.S. prosecutors have accused Rana of running a Chicago immigration services firm that served as a cover for Headley as the American scouted targets for LeT.
Rana, 50, is charged with providing material support for terrorism, including serving as a conduit for messages between Headley and a man known as "Major Iqbal" believed to be part of the ISI. Iqbal is also charged but is not in custody.
Headley, a key trial witness who admitted ties to LeT and the ISI, has pleaded guilty to helping with the Mumbai attacks and plotting to attack a Danish newspaper that published cartoons lampooning the Muslim Prophet Mohammed.’
"The timing of this is going be read in Pakistan as an ongoing effort to embarrass or attack their credibility," said Juan Zarate, a counterterrorism official under former President George W. Bush.
Zarate said there was not a similar case with the potential for such a geopolitical impact in recent memory and that it will be viewed in Pakistan as piling on at a critical moment.
While U.S.-Pakistani relations long have been marred by mistrust, bin Laden's holing up in a Pakistani garrison town has worsened matters. Pakistan denies providing support to bin Laden or knowing he was in Abbottabad.
Evidence presented during the trial could provide more ammunition for U.S. lawmakers who have called for pulling back on giving Pakistan billions of dollars in foreign aid every year, putting pressure on President Barack Obama to act.
The trial also could help Obama look tougher on terrorism.
Lawyers for Rana have said they are planning to use statements Headley gave to the Indian intelligence service and the FBI to help prove their client was duped by Headley.
"According to Headley every big action of LeT is done in close coordination with ISI," India's National Investigation Agency said in a confidential report after interviewing Headley last year, a copy of which was obtained by Reuters.
Headley told the Indians that top LeT members were handled by ISI officials, and one of his handlers was Iqbal.
U.S. District Court Judge Harry Leinenweber, overseeing the trial, already has rejected an attempt by Rana's lawyers to use as a defense that their client believed that his actions were legal because he thought he was working for the ISI.
He "cannot rely on the authority of a foreign government agency or official to authorize his violations of United States federal law," Leinenweber wrote last month.
James Kreindler, an attorney in New York, filed suit against ISI seeking unspecified monetary damages on behalf of victims of the Mumbai assault.
"If you asked me a week or two ago, on a foreign relations point of view, the U.S. doesn't want to alienate Pakistan. But now it's a different ballgame," he said, citing bin Laden's proximity to a Pakistani military base and Iqbal's indictment.
(Additional reporting by Andrew Stern in Chicago and Mark Hosenball in Washington; Editing by Mary Milliken and Will Dunham)