Watchdog Groups Release Findings of CAIR-California Misuse of $26 Million in Taxpayer Funds
New watchdog report reveals CAIR-CA misused government grants and concealed lobbying activities—receiving over $26 million in taxpayer funds despite ongoing DOJ and state investigations
The Council on American-Islamic Relations, California (CAIR-CA) systematically misused millions of dollars in government grants while concealing extensive lobbying activities, according to findings released by the Network Contagion Research Institute (NCRI) and the Intelligent Advocacy Network (IAN).
The organization has received over $26 million in state and federal funding since 2022, even as it now faces investigations by both the Department of Justice’s Executive Office for Immigration Review and the California Fair Political Practices Commission.
Circular Funding Scheme and Accounting Failures
The investigation uncovered what researchers describe as a circular funding scheme: CAIR-CA redirected over $3.7 million back to two of its own offices in Los Angeles and San Diego through subgrants, despite requirements mandating at least $5 million go to independent providers. Public records show these offices are not separate legal entities but operate under the same tax identification number as CAIR-CA, making the transfers effectively self-payments.
Independent auditors conducting CAIR-CA’s 2023 Single Audit identified significant deficiencies that prevented verification of how federal funds were spent. The findings indicate CAIR-CA failed to record grant expenditures in its accounting system and did not retain required reports on service delivery or proof of submission to regulators.
Undisclosed Lobbying Activities
Between 2013 and 2023, CAIR-CA spent over $3.8 million on lobbying expenses while reporting only $672,537 to the IRS—leaving $3.13 million undisclosed, according to the report. The largest spike in undisclosed lobbying coincided with increased federal funding in 2023. Federal law prohibits using federal funds for lobbying activities.
Beginning in late 2023, CAIR-CA’s advocacy became increasingly dominated by anti-Israel political mobilization. The organization’s 2023 annual report prominently featured a “STOP THE GENOCIDE” banner, marking a shift from previous years. Recent lobbying efforts in 2025 include campaigns to influence California legislation on redistricting and school discrimination protections—all conducted while receiving federal funds.
Despite receiving millions in government grants, the findings show CAIR-CA did not properly report them on IRS Form 990 filings, instead obscuring them under general contributions. The organization also failed to disclose subgrants to regional chapters and omitted required related-party transaction disclosures.
Campus Protest Support and Stop the Hate Funds
CAIR-CA provided institutional support for pro-Palestine campus encampments following the October 7, 2023 Hamas attacks on Israel, the report documents. CEO Hussam Ayloush participated as a featured speaker at UC Riverside and UCLA encampments in his official capacity. CAIR-CA established an education fund offering loans and grants to students who faced consequences for protest activities, raising over $64,000 and awarding $20,000 to 20 students.
This occurred while CAIR-CA was receiving $2.6 million under California’s “Stop the Hate” initiative designed to combat bias. Zahra Billoo, Executive Director of CAIR-SFBA, made a social media post praising former Hamas leader Ismail Haniyeh as a martyr, according to the findings. CAIR-CA’s legal arm simultaneously defended a British commentator, Sami Hamdi, who praised the October 7 Hamas attacks.
Funding Continues Despite Investigations
CAIR-CA was granted an additional $10 million in federal trust funds in July 2025—even as the organization remained under investigation by the DOJ and California Fair Political Practices Commission for potential violations of lobbying disclosure requirements.
The report outlines potential violations of multiple statutes, including the False Claims Act, federal conflict-of-interest provisions, California’s Political Reform Act, and prohibitions on using appropriated funds for lobbying. Researchers recommend forensic audits, subpoenas of internal communications, and coordination between IRS Criminal Investigations, the California FPPC, and the DOJ Office of Inspector General.
Hoping CA will follow TX in declaring CAIR & Muslim Brotherhood as terror groups.