Police in the North believe the INLA was responsible for the murder of Mr Charles Folliard, a Protestant man shot dead in front of his 16-year-old Catholic girlfriend in Strabane, Co Tyrone, last week.
A police spokesman also confirmed that three men arrested in Strabane yesterday were being questioned in connection with terrorist crime in the town.
Mr Folliard (30), a former loyalist paramilitary prisoner, was shot by two masked gunmen as he sat in his car at about 11.30p.m. on October 29th.
A member of the UDA, Mr Folliard had been jailed for 14 years for conspiracy to murder and possession of firearms in 1991. His family said he had severed all links with paramilitaries since his release from prison in 1998.
Forensic tests have shown that the gun used in Mr Folliard's killing had previously been lost by RUC officers in the town.
The Heckler and Koch Mp-5 machine-pistol had fallen out of the back of a police Land-Rover in May 2000.
Although officially on ceasefire since the Belfast Agreement came into effect, the INLA has since been blamed for six murders, three in the North and three in the South.