The US government has alleged that Interpal is funding or supporting terrorism, and American citizens and permanent residents are prohibited from doing business with them because of a listing as a Specially Designated Nationals in 2003.

[7] On its website, Interpal states that due to the volatile situation in the occupied territories, the organisation transfers funds to local authorised partners and allows goods and supplies to be purchased within the area.

[13] Subsequently, the Telegraph issued the following apology and retraction on 29 November 1997: "On 26 May 1996, in an article entitled "London fatwa backs suicide bombers", we suggested that the Palestinian Relief and Development Fund (INTERPAL) was run by Hamas activists who encourage and support terrorist activities in Israel.

We also reported claims which were being investigated by the Charity Commission that INTERPAL was used to raise money to fund the training of suicide bombers in Gaza and the West Bank.

The Commission concluded that the charity is a "well run and committed organisation which carries out important work in a part of the world where there is great hardship and suffering" and that INTERPAL takes every possible step to ensure that its donations go only to charitable purposes, helping the poor and needy.

"On August 22, 2003 the United States Department of the Treasury published a list of six individuals and five charities it alleged to have links to Hamas and terrorism.

The Treasury Department's Office of Foreign Assets Control put them all on a list of individuals and organisations with whom United States citizens and permanent residents are prohibited from doing business.

[14] A few weeks later, after a full investigation, the British Charity Commission cleared Interpal of any illegal activities, finding the U.S. Treasury did not provide evidence to support their allegations, and unfroze its assets.

[18]In July 2006 the BBC broadcast a Panorama programme, "Faith, Hate and Charity", alleging that Interpal donated funds to voluntary organisations in the Palestinian territories that supported the ideology of Hamas.

[19] The head of the Charity Commission said on the Panorama programme that the presenting journalist had raised some "pertinent" issues concerning the organisation's links to Hamas that should be investigated.

On 4 January 2007 the Commission "reiterated its 1996 conclusion that Interpal is 'a well run and committed organisation which carries out important work in a part of the world where there is great hardship and suffering'.

"[20] After an extended investigation, in February 2009 the Charity Commission report[13] dismissed allegations by Panorama that Interpal was funding organisations involved in terrorism.

[13] However the inquiry concluded that Interpal "had not put in place adequate due diligence and monitoring procedures to be satisfied that these organisations were not promoting terrorist ideologies or activities.

The inquiry concluded that they "could not verify that the material it examined suggesting certain partner organisations funded by the charity may be promoting terrorist ideology or activities.

Although Interpal did have to request an extension of the deadline given by the Charity Commission, it had by June 2012 published a Partnership and Funding Operations Manual that set out procedures that would effectively address the failings reported in the 2009 inquiry.

[24][8] In 2006 the Jerusalem Post was forced to apologise to Interpal and its bank NatWest for an article in which the paper claimed the charity was connected to a terrorist organisation.

The paper also issued a correction to the articles in April 2019 and apologised saying it accepted that "neither Interpal, nor its trustees, have ever been involved in or provided support for terrorist activity of any kind".

We hope that this significant success will encourage commentators and others to take seriously their responsibility for reporting unbiased, accurate information to the general public and service providers".

[27][28] In August 2019, Interpal received an apology and damages of £50,000 from The Jewish Chronicle which had implied in a March 2019 article that the charity had links to terrorist activity.

[8] The lack of normal banking services means that Interpal has no direct debit facility and donations can’t be made by credit card.