WASHINGTON - Iraqi officials have informed the United States that Baghdad has released a Hezbollah operative accused by U.S. military prosecutors of killing U.S. troops, terrorism and espionage, U.S. officials said Friday.

Ali Musa Daqduq was released despite the entreaties of the Obama administration. In a phone call on Tuesday, Vice President Joe Biden told Iraqi Prime Minister Nouri al-Maliki that the United States believed that Daqduq should be held accountable for his actions, a U.S. official said.

But Al-Maliki told Biden that Iraq had run out of legal options to hold Daqduq, who had been ordered released earlier this year by an Iraqi court.

A lawyer for Daqduq said he was now in Beirut.

"We are clearly disappointed about this," said a State Department official, who asked not to be identified.

"Iraqis did pursue a legal case on him and said that the evidence was not there. We do have to respect the authority of the Iraqi judiciary."

The case is noteworthy not only because of the allegations against Daqduq but because it is regarded by Middle East experts as a test of whether the United States or Iran has more influence in Iraq.

Hezbollah, a Shiite militant organization in Lebanon, is backed by Iran, a Shiite state. Iraq's government is also Shiite dominated.

In Washington, conservative lawmakers deplored the decision to release Daqduq. Sen. John McCain, R-Ariz., called it an "outrage."

Daqduq, who was captured by British forces in Basra in March 2007, was the last detainee to be handed over to the Iraqis by the United States as U.S. troops withdrew in December 2011.

U.S. military officials have accused him of working with the Quds Force -- an Iranian paramilitary unit that supports militant movements abroad -- to train Shiite militias in Iraq during the war. One of the most serious allegations stems from his suspected role in helping to organize a January 2007 raid in Karbala that led to the deaths of five U.S. soldiers.