Regulators are investigating a British charity over claims that a Gaza welfare organisation it has funded has close links to Hamas.

The Charity Commission is examining payments made by the We Care Foundation to the Qawafil Al Khair Association in Gaza, as well as other groups.

Qawafil is alleged to target much of its help to the widows and orphans of dead Hamas fighters, and was designated as a terrorist organisation by the Israeli government last month.

Pro-Israel campaigners say videos produced by Qawafil show crowds parading the coffins of “martyrs” whose families it helps.

One video is said to show an orphaned boy brandishing a toy gun like a fighter in the new flat presented to his mother by Qawafil.

We Care has held a number of major fundraising initiatives for Qawafil, with one recently launched campaign having raised more than £250,000 so far.

It is the subject of an investigation by the Charity Commission over what the regulator described as “substantial payments” made by the charity to its trustees and companies for which they are directors.

Its accounts were frozen after the commission said the payments were not disclosed and had not been adequately explained.

The commission is also assessing information received from UK Lawyers for Israel about We Care’s links to Qawafil within the scope of the existing inquiry.