The army said the death of Omar Assad on January 12 was a result of "moral failure and poor decision-making".

Assad's death had sparked calls for an investigation from the US State Department and from members of Congress from Wisconsin, where Assad had previously lived for decades, the Milwaukee Journal Sentinel reported.

Assad died after troops detained him in a late-night security operation in the village of Jiljilya, north of Ramallah.

The army said Assad had no identification and "refused to cooperate". Soldiers tied his hands and gagged him and took him to a nearby building with three other detainees.

When troops released them, the army said they thought Assad was "asleep" and left him where he was.

A post-mortem found he died of a "stress-induced heart attack caused by the circumstances of his detention by Israeli soldiers," the Palestinians' official news agency Wafa reported.

"The investigation concluded that the incident was a grave and unfortunate event, resulting from a moral failure and poor decision-making on the part of the soldiers," the army said in a statement.

Armed forces chief of staff Lieutenant General Aviv Kochavi said: "Leaving Mr. Assad alone and without checking his condition was a careless act that runs contrary to the values of the Israel Defence Force, at the centre of which is the requirement to protect the sanctity of any human life."

The troops were part of the Netzah Yehuda Battalion of religious Jews.

The investigation was carried out by the head of Central Command, which oversees operations in the West Bank.

As a result of the probe, the battalion commander will be reprimanded, while the platoon and company commanders will be stripped of their commands and "not serve in commanding roles for two years."

The army said the military police are conducting a separate investigation into the case that could lead to criminal charges.

Israeli human rights group Btselem said Assad was 78 at the time of his death.

It said it had recorded 77 Palestinian deaths at the hands of Israeli security forces in the West Bank last year. More than half of those killed were not implicated in any attacks, it added.