A man was allegedly warned he would be shot dead by an INLA gang unless he paid them £35,000, the High Court heard.
It was claimed the threat was made after suspects turned up at his holiday home in Co Louth.
Three Belfast men face charges of blackmail, threats to kill, and membership of an illegal terror organisation over the alleged incident.
They are: Damian Justin Morgan (43), of Vicinage Park; Michael Lawrence Smith (33), from Ardmonagh Gardens, and Patrick McCrory (54), of Mountpottinger Road, all in the city. The three deny the charges.
The allegations against them are based on a statement from the alleged victim's wife, a judge was told.
Prosecution counsel Nicola Auret said the woman claimed the men spoke to her husband in a car as they were leaving the home and that they wanted £35,000 or they would shoot him.
According to the prosecution, the men claimed to be from the INLA. The three were arrested after police received details of their location from the woman.
Details were set out during a prosecution appeal against a court decision to grant bail to the suspects.
Lawyers for the three accused argued that the main alleged victim — the woman's husband — has so far failed to provide a statement. It was contended that the current evidence does not amount to a prima facie case against them.
The judge, Mr Justice Treacy, adjourned the appeal hearing until he receives further information from the prosecution.