Two major donors to campaign group Cage have pulled funding in protest at the organisation's apparent defence of the Islamist militant Mohammed Emwazi, known as Jihadi John.
The Charity Commission revealed it had taken "robust action" to demand that the Joseph Rowntree Foundation and the Roddick Foundation would cease all current and future donations to the group.
Boris Johnson has accused advocacy group Cage of amounting "an apology for terror" after it suggested MI5 may be partly to blame for Mohammed Emwazi turning to violence.
"It was incredible that people could stand up and pretend that somehow it was the fault of the security forces for trying to apprehend and impede these guys and that that could somehow cause them to be radicalised," the Mayor of London said.
"I think that is beyond satire and amounts to nothing less than an apology for terror. I hope they will be rethinking their position."
Downing Street earlier said Cage's claim was "reprehensible".
Lawyers for Mohammed Emwazi's father have told ITV News there's no evidence his son is IS killer 'Jihadi John' as "his face is covered".
Newly released audio recording of Mohamed Emwazi, aka "Jihadi John", reveals his claims that he was threatened by MI5 five years ago.
"I really think that the focus of your outrage should be people who throw gay men off cliffs", said London Mayor, Boris Johnson.