CAIRO (Reuters) - Egypt's justice minister said on Tuesday he had sent back a letter from the U.S. ambassador that asked for an end to a travel ban on Americans being investigated for alleged illegal funding of pro-democracy groups.
U.S. officials have warned the escalating dispute could imperil some $1.3 billion in annual U.S. aid to Egypt's military, and Republican Senator John McCain said on Tuesday he planned to raise the issue during a visit this week by a senior Egyptian military delegation.
In Cairo, Justice Minister Adel Abdelhamid Abdallah said he returned the U.S. embassy letter, highlighting strains between Washington and its long-standing Arab ally since the overthrow last year of Egyptian President Hosni Mubarak in a popular uprising.
Washington said several U.S. citizens working for civil society groups were banned from leaving Egypt and took refuge at its embassy in Cairo after the non-governmental organizations were raided by the military-led Egyptian authorities.
Abdallah said U.S. Ambassador Anne Patterson's written request to lift the travel ban was sent to his home and he returned it to the U.S. embassy because it should have been sent to the investigating judges.
"In it were the names of the people banned from travel and it was asking for a cancellation of this decision to be considered, as their constitutional right," he said.
"I spoke to the embassy and I returned this letter and told them that this letter should be sent to the investigating judges and not to the minister of justice," he said.
Abdallah said only those concerned by the travel ban or their representatives were entitled to send such a letter.
In Washington, the State Department confirmed that Patterson sent the letter, describing it as one of a number of attempts to raise the travel ban issue with Egyptian authorities.
"It was the justice minister's prerogative to send this letter back. We're going to continue to engage on this," State Department spokesman Mark Toner told a news briefing.
Toner said Washington would continue to press Egypt to allow the NGO staffers to leave.
"We believe that it's important that they be allowed to travel freely and that the conditions that have been placed on them are unfair," Toner said.
ACCUSATION OF "INTERFERENCE"
Parliament speaker Mohamed Saad al-Katatni, a leading figure in Egypt's Muslim Brotherhood which now dominates the assembly's lower house, said Patterson's request was "interference by the American embassy that we do not accept."
The U.S. embassy in Cairo had no comment.
U.S. officials said they will raise the NGO issue when a senior Egyptian military delegation visits Washington this week.
The delegation of generals is expected to meet with officials at the State Department and Pentagon, and Republican Senator John McCain said he planned to meet them on Wednesday.
Asked whether U.S. military aid to Egypt - which must be approved by Congress - was in jeopardy, McCain said that would be a subject of the discussion.
"I'm saying that it's certainly a topic that's on the table, that they've put on the table," he told reporters outside the Senate.
U.S. Defense Secretary Leon Panetta, in a weekend call to the head of Egypt's ruling military council, Field Marshal Mohamed Hussein Tantawi, urged the Egyptians to lift the travel ban and expressed concern over restrictions placed on NGOs.
President Barack Obama also discussed the NGO issue with Tantawi in a phone call earlier this month.
Egypt's government says the number of NGOs violating the law on funding political activities had grown since the uprising against Mubarak.
Groups including the U.S.-funded National Democratic Institute and International Republican Institute were raided in late December by judicial police, who took documents and equipment before sealing their offices shut.
Civil society groups said the military council had ordered the raids to defame and stigmatize activists, rights groups and others who were at the forefront of the anti-Mubarak revolt and are now demanding the army hand power immediately to civilians.
Among those prevented from leaving Egypt was the IRI's Egypt country director Sam LaHood, who is the son of U.S. Transportation Secretary Ray LaHood.
(Reporting by Ahmed Tolba and Tom Perry; additional reporting by Andrew Quinn and Susan Cornwell in Washington; Writing by Edmund Blair and Tom Pfeiffer; Editing by Mark Heinrich and Eric Beech)