By Edith Honan

NEW YORK, April 25 (Reuters) - The suspected head of the U.S. branch of Sri Lankan rebel group the Tamil Tigers was arrested in New York on Wednesday and charged with providing material support to a foreign terrorist organization.

Karunakaran Kandasamy could face up to 15 years in prison if convicted, prosecutors at the federal court in the New York borough of Brooklyn said.

As the director of the U.S. branch of the Tamil Tigers, which is based in Queens, New York, Kandasamy oversaw the organization's activities, including its fund-raising, prosecutors said.

The rebels, known officially as the Liberation Tigers of Tamil Eelam, or LTTE, have been fighting for decades for an independent homeland on the north and east of the teardrop-shaped island in the Indian Ocean.

Since 1983 the fighting has killed some 68,000 people, including more than 4,000 in the past 16 months. The LTTE is designated as a foreign terrorist organization by the United States.

According to the government's complaint, the LTTE relies on sympathetic Tamil expatriates to raise money, get weapons and spread propaganda.

To coordinate these activities, the LTTE has established "branches" in at least 12 countries including the United States, the government's complaint said.

In the winter of 2004, Kandasamy held fund-raising events in the New York City area as part of a worldwide campaign in advance of a major Tamil Tigers offensive against the Sri Lankan government, prosecutors said.

Kandasamy also arranged meetings in LTTE-controlled territory in Sri Lanka between LTTE leaders and prominent LTTE supporters from the United States.

"For years the LTTE has covertly operated within the United States, drawing on America's financial resources and technological advances to further its war of terror in Sri Lanka and elsewhere. We refuse to allow this to continue," U.S. Attorney Roslynn R. Mauskopf said in a statement.

U.S. Magistrate Judge Kiyo A. Matsumodo ordered that Kandasamy be held without bail on a temporary order of detention. Kandasamy's next court appearance is scheduled for April 30.

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