A U.S. bank regulator has ordered Palestinian-managed Arab Bank Group to convert its New York branch to a federal banking agency, ending the bank's wire transfer business. The U.S. Office of the Comptroller of the Currency (OCC) said it determined that the bank's branch had internal control weaknesses, especially in its international funds transfer activities. Arab Bank, by far the largest bank operating in the Palestinian territories, has had several lawsuits brought against it on behalf of relatives of U.S. citizens killed or injured in violence in the Middle East, accusing the bank of helping move money to families of suicide bombers.The Jordan-based bank has denied that it helped transfer such funds and said it had made extensive investments to promote peace by financing projects in Palestinian territories. On Friday OCC said the bank agreed to convert the branch to an agency office and take steps to improve its compliance program and internal controls. A bank spokesman said the OCC order forces Arab Bank to exit the wire transfer business, but allows it to continue activities in trade and corporate finance.