The advocacy group Cage has lodged an application for a judicial review of the actions of the Charity Commission, saying it believes the regulator "exerted unlawful pressure" on two grant-making charities to stop funding it.
Cage, which is not itself a charity, was the subject of international media attention in February when one of its directors said that Mohammed Emwazi, a graduate of the University of Westminster who had been named as the Islamic State executioner known as "Jihadi John", had been "a beautiful young man".
Asim Qureshi also suggested that harassment by MI5 had contributed to Emwazi’s radicalisation, and Cage released emails from Emwazi about his life before joining IS.
The commission then issued a statement saying it was "robustly examining" the decisions of the Joseph Rowntree Charitable Trust and the Roddick Foundation to have provided funding to Cage in the past, and that it had opened operational compliance cases on both charities.
The following week, another commission statement said the JRCT and the Roddick Foundation had confirmed that they would no longer provide funding to Cage, although the JRCT said it had been subject to "intense regulatory pressure" from the regulator.
Cage said in a statement today that it had since "become aware of other charities that were questioned about sharing a platform with them", and said that the commission was "exceeding its role as a regulator".
The organisation has sought permission from the High Court in London to have a judicial review hearing examining the commission’s actions in this case. A decision on whether or not permission is granted could take several weeks or months, and the High Court sits only until the end of July, after which it closes down until the end of September.
Ibrahim Mohamoud, communications officer at Cage, said: "At a time when the commission is being given more powers, it is important that it does not deviate from its crucial role as an impartial regulator and become an instrument of state policy in a political agenda against unpopular causes.
"Charities must be able to function with a regulator that does not create a climate of fear and undermine the fundamental freedoms of expression and association. In recent years, the Charity Commission appears to be assuming the role of counter-terrorism police, rather than a charity sector regulator."
Zoe Nicola, an associate lawyer at HMA Solicitors, which represents Cage, said: "The actions of the Charity Commission in this instance will have a chilling effect on the ability of third sector and charitable organisations to engage in controversial debates and are counter-productive."
A Charity Commission spokeswoman said: "We can confirm that the commission is aware of this legal claim and that we are considering it carefully. We cannot comment further at this stage."