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One of the investors in the proposed Islamic center and mosque near Ground Zero in New York was a donor to a charity that was later shut down due to its connection to Hamas.

According to an AP report on Friday, Hisham Elzanaty, 51, is among the members of a real estate partnership that paid $4.8 million for the vacant clothing store that is planned to be torn down and replaced by the Islamic center and mosque. This information was confirmed by the developer leading the project.

Critics of the Ground Zero project have pointed to a donation made by Elzanaty to the Holy Land Foundation for Relief and Development in 1999. According to tax records, Elzanaty gave $6,050 to the foundation, which was the largest Islamic charity in the US at the time. The Holy Land Foundation raised millions of dollars from Americans in the 1990s. The money was supposed to fund schools, orphanages and social welfare programs.

However, in 2001, the US government froze the foundation's assets and accused it of acting as a fundraiser for Hamas, which has been a recognized terrorist group in the States since 1995. Furthermore, in 2004, the foundation and some of its leaders were indicted on charges of supporting Hamas, and five were ultimately convicted.

During a 2002 interview with Newsday, Elzanaty mentioned his philanthropic activities involving PA Arabs: "When you see people surrounded by tanks and F-16s, you ask how can we help? But you don't want years later to have a knock on the door and someone asking why did you donate money?"

AP also reported that besides Elzanaty, others also donated to the Holy Land Foundation in 1999, including NBA star Hakeem Olajuwon, the Microsoft Corp., and a medical equipment company owned by General Electric.

Newspaper stories questioning whether the Holy Land Foundation had ties to Hamas began to appear as early as 1993, AP added. Israel banned the foundation in 1997, but the US did not crack down on it until after the September 11 attacks.

Elzanaty's lawyer told a reporter for WNYW on Thursday that his client had no knowledge of the foundation’s involvement with Hamas when he donated the money, and had intended the donation to go to an orphanage.

Sharif El-Gamal, the developer in charge of the ground zero mosque project said in a statement quoted in the Wall Street Journal: "Hisham is a major investor in the Park51 project. He is one of eight investors all whom agree with me that this project will not be funded in anyway from any country, terrorist organization or entity hostile to America or its values."

While El-Gamal has so-far not revealed the names of his other financial backers, he has said that the group is diverse and includes Jews and Christians, Polish-Americans, Italian-Americans, and others. El-Gamal and Elzanaty are reportedly the only Muslims in the group.

Three months ago, it was also revealed that Imam Feisal Abdul Rauf, the cleric behind the proposed mosque, is a major donor to the pro-Hamas Free Gaza movement, which has been behind several attempts to break the Israeli sea embargo on Hamas, including sending the “Rachel Corrie” ship.

The project itself has been a source for controversy in the US, as protests both for and against it have taken place. While the project has been endorsed by politicians such as President Barack Obama as well as New York City Mayor Michael Bloomberg, others such as former New York Mayor Rudy Giuliani and Sarah Palin have spoken out against the project.

A CNN poll conducted on August 11 found that 68 per cent of Americans oppose the Muslim center project in Ground Zero.