DUBAI (Reuters) - A court in Bahrain on Sunday convicted the spiritual leader of the country’s Shi’ite Muslims of collecting funds illegally and money laundering and sentenced him to one year in jail suspended for three years, local media reported.

The court also ordered Ayatollah Isa Qassim, who is in his mid-70s, to pay 100,000 Bahraini dinars ($265,266) in fines over the charges, which emanate from the collection of an Islamic tax called Khums, which in Shi’ite Islam is collected and spent by a senior cleric in the interests of the needy.

The case had ratcheted up tensions in the Western-allied Gulf Arab state where the U.S. Fifth Fleet is based.

The kingdom has been convulsed by occasional unrest since authorities crushed 2011 protests mainly by Shi’ites demanding a bigger share in running the country.

The Arabic-language al-Wasat said the court also ordered the confiscation of 3.367 million dinars found in a bank account in the cleric’s name.

State news agency BNA, in a report that only referred to Qassim as a cleric, quoted the public prosecutor as saying the funds would be used for charity and humanitarian work once the ruling was deemed final.

“The public prosecutor asserted that the prosecution was currently studying the sentence to determine the possibility of an appeal,” BNA said.

The trial is part of a wider crackdown on dissent that included a ban last year on the main Shi’ite Muslim group Wefaq. Authorities accuse the group of fomenting sectarian unrest and having links to a foreign power, an apparent reference to arch-foe Iran. Tehran denies any interference in Bahrain.

Iran condemned the verdict and called on the Bahraini government to show respect for Qassim’s high religious ranking, the state news agency IRNA reported.

“The Bahraini government is expected to seriously consider his (Qassim’s) influence and moral authority, respect the will of the people, and cease pressures on Bahraini Muslim scholars,” IRNA quoted Foreign Ministry spokesman Bahram Qasemi as saying.

Bahrain’s justice ministry took steps last week to dissolve the secular National Democratic Action Society (Waad) it accuses of supporting terrorism.

Qassim also faces expulsion from the kingdom after authorities revoked his citizenship last year for alleged foreign links and fomenting violence, charges he had denied.

His defense lawyers had refused to attend the hearings, which they saw as an attack on the country’s Shi’ites.

($1 = 0.3770 Bahraini dinars)