Evidence given by a new witness in the Bank of China court case taking place in New York could prove crucial to the outcome given the reluctance of the Israeli government to allow its official to testify in court.

Two actions are being pursued against the Chinese bank by families of the victims of suicide bombings that took place in Israel.

They accuse the bank of being complicit in the terror attacks by knowingly transferring funds to Hamas and Islamic Jihad.

The two connected cases rely to a great extent on the evidence given by Israeli intelligence officials on warnings they gave to the Bank of China that it was dealing with funds that financed terror operations.

Uzi Shaya, an Israeli counter-terrorism expert who took part in a meeting with representatives of the Chinese bank, was to be a central witness for the plaintiffs and has been subpoenaed to appear in court in two weeks.

It is still unclear whether Mr Shaya will go to New York. The Israeli government, which originally encouraged the terror victims’ families to pursue the claim in court, is now trying to improve its relations with the Chinese government and has withheld authorisation for him to act as a witness.

While lawyers acting on behalf of the families still hope that Mr Shaya will arrive, they have identified another potential witness: Stuart Levey, a former banking expert in the US Treasury. Mr Levey took part in another meeting in which the Americans warned the Bank of China of the implications of its alleged involvement in money transfers to Hamas and Islamic Jihad.

The involvement of Mr Levey, now a senior employee of HSBC, came to light in a US diplomatic cable exposed two years ago by the Wikileaks website. The connection was only made recently, however, and now the lawyers are planning to subpoena him as their alternative star witness.