Shvut Rachel, West Bank - A US native from this isolated settlement was arrested by Israeli security services nearly a month ago amid allegations that he killed two Palestinians more than a decade ago and attempted to murder two others more recently. The local media are calling it the latest case of Jewish terrorism.

The accusations against Yaakov Teitel, the son of a US Navy dentist, is fanning concern in Israel that nationalist vigilantes in Israel still have the ability to carry out attacks aimed at sabotaging peace negotiations and expected land concessions.

The case is even more loaded because security services publicized it Sunday – just days before the Nov. 4 anniversary of the 1995 assassination of Yitzhak Rabin by Jewish extremist Yigal Amir, which derailed the peace process for years.

"Tough decisions are right around the corner. With [US President Barack] Obama's pressure to move toward negotiations, Israeli Prime Minister Benjamin Netanyahu is liable to make unpopular decisions," says Yaron Ezrahi, a professor at Hebrew University. "This is a reminder of the need to deal with these people and not to allow them to threaten decision makers."

Late Sunday, Israeli Prime Minister Benjamin Netanyahu said in a statement that Israel must fight a "marginal minority" of extreme nationalists threatening Israel's democracy.

Teitel from religious home in US

Raised in a fervently religious home in Virginia, Teitel formed friendships when he first visited Israel in the 1990s with young ideological settlers who were setting up outposts on empty hilltops across the West Bank.

According to Israeli security services, Teitel, on an extended visit to Israel in 1997, allegedly killed a Palestinian taxi driver in Jerusalem and a shepherd in the southern West Bank within a few months of each other. Though Israeli police interrogated him in one of the killings, he was let go.

Around 2003, he moved permanently to Shvut Rachel, a small religious community nestled in a region of settlements where it's common to see posters praising Rabbi Meir Kahane, who advocated the expulsion of Palestinians from the West Bank.

Around a decade later, he planted bombs outside the homes of Zeev Sternhell, a prominent left-wing political science professor from Hebrew University, and a Messianic Jewish family in the settlement of Ariel. Police also accused him planting a bomb near officers patrolling a gay pride parade in Jerusalem.

Teitel reportedly claimed responsibility for an August shooting attack that killed two in a gay youth group in Tel Aviv, but police don't believe him.

Vigilante cases can throw off peace talks

A year prior to the infamous Rabin assassination, peace talks were thrown off track after Brooklyn-native Baruch Goldstein gunned down Muslims at prayer in the Tomb of the Patriarchs shrine in the West Bank city of Hebron, and was then killed himself.

Like Mr. Goldstein and Yigal Amir, Teitel appeared to operate on his own rather than as part of a clandestine militia. Family members and neighbors from Shvut Rachel say they had no indications of Teitel's alleged propensity for violence.

"People are surprised by the allegations," says Shvut Rachel spokesman Shmaya Tiram. "He was a familiar but unknown person. He was introverted and quiet."

But Israeli columnists argued on Monday that security services should have apprehended Teitel faster, suggesting that not enough resources are being invested to uncover Jewish militants.

"If there is an accelerated peace process, if there is need to evacuate settlements once again, the result is going to be bitter clashes," wrote Alex Fishman, a political columnist for Yediot Ahronot newspaper. "The Teitel affair teaches us that not only do the lunatic fringes exist, but that they are armed and aren't afraid."

Residents of Shvut Rachel expressed concern that the allegations would leave a stain on the community as extremist.

"All I can say is, this is not the way we live, and this is not our agenda," says Sarah Avitan, Teitel's sister-in-law. "We don't take the law into our own hands."