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WASHINGTON, Sunday (AFP)

The United States on Friday branded the insurgent Maoist Communist Party of Nepal a threat to US national security and froze the group's assets prompting a warning of possible retaliation against Americans.

The State Department said the designation - which freezes any assets the Maoists may have in the United States or under US jurisdiction - had been made on October 23 but had been kept secret to prevent the group escaping the sanctions by transferring those funds.

Immediately after the determination was made public, the US embassy in Kathmandu advised Americans in Nepal to keep a low profile and exercise special caution "during the upcoming time period."

There is "the possibility of an increased threat to Americans and American-affiliated organizations from Maoist insurgents in the coming days," the embassy said in a notice to US citizens.

The notice did not say why the threat might be heightened but a copy of it was provided to AFP in Washington by the State Department shortly after the sanctions were announced in the Federal Register, a government gazette.

"I hereby determine that the Communist Party of Nepal ... has committed, or poses a significant risk of committing, acts of terrorism that threaten the security of US nationals or the national security, foreign policy, or economy of the United States," Deputy Secretary of State Richard Armitage said in the notice.

The notice listed several aliases for the organization including the United Revolutionary People's Council, the People's Liberation Army of Nepal and the CPN(M), all of which are covered by the sanctions.

It was not immediately clear if the Maoists have any assets that would be covered by the penalties.

Armitage made the determination amid a spike in fighting between Nepalese troops and the Maoist rebels who have been waging a seven-year battle to overthrow the country's constitutional monarchy.

The rebels ended a seven-month ceasefire on August 27 after peace talks broke down, setting off the latest surge in fighting that one human rights group says has killed 1,092 people had died.

Nepalese authorities have accused the Maoists of stepping up extortion since the end of the truce, driving some villagers to suicide.

Overall tolls from violence in the Himalayan kingdom are difficult to verify independently as the clashes often occur in remote areas but the government says the insurgency, which began in 1996, has claimed more than 8,200 lives.

Human rights groups put the toll closer to 8,900.

The United States has grown increasingly concerned about the situation in Nepal and has issued frequent travel warnings advising US citizens to take special precautions while there or to avoid going at all.

The latest of those, released on October 22, said that "anti-American rhetoric by rebel leadership, including against US-sponsored or -supported humanitarian organizations, has increased, raising security concerns for all US citizens living in or visiting Nepal."

The Maoists said that Americans would be safe in Nepal as long as they did not assist Nepal's military although they are held responsible for the murders of two Nepalese guards at the US embassy and have threatened foreign missions in Kathmandu.

They have also targetted US symbols, bombing Coca-Cola bottling plants in April and January 2002 and in November 2001, according to the State Department's latest "Patterns of Global Terrorism" report released in April.

Washington has offered counter-terrorism assistance to Kathmandu to assist in battling the insurgents but has also expressed concern about reports of government abuses.The department identified the Communist Party of Nepal as a terrorist organization in that report for the first time but did not formally designate it a "foreign terrorist organization" which carries financial and travel sanctions.

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