WASHINGTON - Iran is increasing its activity in Latin America and the Caribbean, including actions aimed at supporting the Lebanese militant group Hezbollah, a top U.S. military commander said on Tuesday.

Navy Admiral James Stavridis, who oversees U.S. military interests in the region as head of U.S. Southern Command, also said Hezbollah was linked to drug-trafficking in Colombia.

"We have seen... an increase in a wide level of activity by the Iranian government in this region," Stavridis told the Senate Armed Services Committee.

"That is a concern principally because of the connections between the government of Iran, which is a state sponsor of terrorism, and Hezbollah," he said.

The U.S. State Department lists the Lebanese-based political and military movement as a terrorist organization.

Stavridis said Hezbollah activities in South America have been concentrated particularly in the border region between Brazil, Paraguay and Argentina, but also in Colombia.

"We have been seeing in Colombia a direct connection between Hezbollah activity and narco-trafficking activity," the commander added, without providing specifics.

Colombia said last October that it had smashed a drug and money-laundering ring suspected of shipping funds to Hezbollah.

Hezbollah has denied links to drugs and money-laundering and described allegations as part of a propaganda campaign aimed at harming its image.

President Barack Obama's administration has sought to move toward dialogue with Tehran, despite sharp differences on several topics including Iran's nuclear program. Iran says it only wants to generate power while the Washington and its allies accuse Tehran of trying to build a nuclear bomb.

Stavridis is the latest U.S. defense official to express concerns about Iranian influence in Latin America, where the left-wing governments in Venezuela, Cuba, Ecuador, Nicaragua and Bolivia have all become allies of Iran in recent years.

In January, Defense Secretary Robert Gates told the same Senate panel he was more worried about Iranian "meddling" than he was about Russia's activities in Latin America.

Source:http://www.reuters.com/article/latestCrisis/idUSN17295774