The charity sought a review of the commission’s November decision to open the inquiry after accusations were made that it was being used as a vehicle for fraudulent benefit claims.
But the commission said today it had carried out a review and dismissed the charity’s objection.
The charity has missed the 42-day window to appeal to the charity tribunal against the opening of the inquiry.
In a statement, the commission said: "The reviewer considered the objections as well as information submitted with the request for a review and concluded that the decision to open the inquiry was a reasonable, proportionate and lawful decision, properly taken."
The charity, which has objects including the relief of poverty and sickness and the advancement of education for people in Kenya, Bangladesh, Nepal and the Maldives, had an income of £316,500 and spent £318,500 in the year to 31 March 2014, and has not yet submitted accounts for the 2014/15 financial year.
The commission opened its inquiry after what it described at the time as "serious regulatory concerns" about the charity’s finances and whether payments had been made to trustees and volunteers prompted it to begin monitoring its fundraising practices and financial administration.
The regulator said other government agencies had informed the commission they were investigating concerns that the charity was being used as a vehicle for fraudulent state benefit claims and provided evidence casting doubt on the true identity of the trustees and the validity of the charities’ financial statements.
No one from Families for Survival was available for comment on Wednesday morning.