With Justice Department officials and lawmakers also raising concerns, the embattled agency's director issued a statement defending his actions in the Libya case as "the most proper and effective."
R. Richard Newcomb, director of the Treasury Department's Office of Foreign Assets Control, said his actions were taken with the "full knowledge and coordination of senior Treasury Department officials and were fully coordinated with the State Department."
Newcomb's statement made no mention of coordinating with the Justice Department, which was running a simultaneous criminal probe into alleged money laundering by a New York bank of Visa checks purchased by Libyans -- violating a U.S. embargo.
Justice for Pan Am 103, a group which says it represents about half of the 189 American families victimized by the terrorist bombing, issued a statement Tuesday demanding Newcomb's resignation.
"This administration has a pattern of talking tough about terrorism in public, but privately and behind the scenes ... of doing nothing, ignoring or actually helping those who are dealing with Libya,"spokeswoman Susan Cohen said.
Cohen's 20-year-old son Theodore, died in the 1988 terrorist bombing over Lockerbie, Scotland. Libyans were blamed.
The Associated Press reported this week that a 1994 probe into Libyan money laundering was shut down after Newcomb's office disclosed sensitive information.