The leader of an organization of Sri Lankan Tamils living in the United States has denied charges that funds raised there are being used to support the "Tamil Tigers" guerrilla insurgency in the northern provinces of the strife-torn island nation.

Sri Thillaiampalam, president of the Eelam Tamil Association of America, dismissed as "fantasy" charges made by Sri Lankan officials that his organization operates much like the Irish American fund-raising group Noraid, which has been accused of financing arms shipments to the outlawed Irish Republican Army in Northern Ireland.

Sri Lanka's minister for national security, Lalith Athulathmudali, said in a recent interview in Colombo that funds raised by Tamils in the United States were being used to purchase weapons and explosives in the south Indian state of Tamil Nadu, which are then smuggled to Sri Lanka's predominantly Tamil province of Jaffna.

"American money is being used to kill Sri Lankans," Athulathmudali said in the Aug. 9 interview with The Washington Post.

More than 3,000 Sri Lankan Army troops and other security forces have been engaged in intensive guerrilla warfare with Tamil separatist guerrillas in Jaffna, where Tamil leaders have accused the troops of killing hundreds of civilians in reprisal attacks following terrorist operations against security patrols.

Thillaiampalam, whose organization represents about 10,000 Tamils living in the United States, said in an interview here that his group was lobbying for U.S. and Indian government pressure on Sri Lanka to protect the human rights of Tamils there. He added that his organization was not openly advocating forcible secession, despite the use of the word "Eelam" in the organization's name. Eelam is the name of the separate state that Tamil separatist are seeking in northern Sri Lanka.

Thillaiampalam said funds were being contributed by American Tamils to the Organization for Eelam Refugees, which is based in the south Indian city of Madras, Tamil Nadu's state capital. Tamil Nadu's 45 million predominantly Hindu Tamils share a common language and ancestry with the 2.6 million Tamils of Sri Lanka, who since the country's independence in 1947 have repeatedly clashed with the mostly Buddhist Sinhalese majority.

Despite its relatively small size, the U.S. Tamil association has been an active lobby against the Sri Lankan government, with which the United States has close economic ties.

In 1981, it persuaded the state legislature of Massachusetts, where 1,000 Tamils of Sri Lankan origin live, to adopt a resolution urging President Reagan to press for the creation of a separate Tamil state in Sri Lanka. Two years later, the state legislature adopted a bill which prohibits the use of state funds for investment in any company that has holdings in Sri Lanka.