Bank accounts of an Islamic charity alleged to have funded terrorist activities, including the recent plot to blow up U.S.-bound flights from London, were frozen today by the Charity Commission for England and Wales.

"We are working with law enforcement agencies to get to the bottom of allegations of possible terrorist abuse by the Crescent Relief funds," said Kenneth Dibble, director of legal and charity services at the Charity Commission.  "The allegations made are very serious, and we are taking this action to protect the charity's funds while the investigation is underway."

ABC News first reported that money donated to Crescent Relief for aid after the earthquake in Pakistan may have ended up in the hands of the alleged airplane bomb plot ringleader, Rashid Rauf. 
According to documents examined by ABC News, Abdul Rauf, the father of Rashid, and Mohammad Mumtaz, Rashid's uncle, established the London-based Crescent Relief in 2000.  The charity, currently run by Mumtaz, has since donated hundreds of thousands of dollars to Pakistan for humanitarian purposes.

Officials say they believe Rashid, who has lived in Pakistan for the past few years, helped distribute the charity money and may have diverted some of the funds for his alleged terror plot.  U.S. officials confirmed  Rashid had wired large sums of money to London for his alleged co-conspirators to buy plane tickets shortly before the plot was foiled.

"The entire family helps" operate the charity, a former director of Crescent Relief, Mohammed Ansari, told ABC News.  Ansari said the funds raised by the charity were definitely earmarked for humanitarian purposes and that he had no knowledge of them being used for other purposes after they reached Pakistan.

Rashid and his father are now both in custody in Pakistan, according to intelligence officials there.  Tayib, Rashid's brother, was released yesterday in Birmingham without charge after being arrested as a suspect in the investigation of the alleged airplane bomb plot.

The Charity Commission says it will issue a full report on its findings once its investigation of Crescent Relief is complete.