A new report from OMB Watch explains concerns about the impact of the war on terror on Muslim charities, and provides a detailed update on the status of U.S.-based Muslim charities that have been shut down by the Treasury Department. Muslim Charities and the War on Terror: Top Ten Concerns and Status Update notes that, "Since the 9/11 terrorist attacks, U.S.-based charities have become targets in the government's war on terror financing. Despite the sweeping implications for all domestic nonprofit organizations, the lion's share of the burden of increased scrutiny, suspicion, and pre-emptive action has fallen on Muslim groups. This imbalanced campaign raises significant legal and ethical questions." The report has been updated to reflect closure of another Muslim charity, on Feb. 19, 2006.

New documents released to the press in December 2005 show federal agencies have been infiltrating and conducting surveillance on a wide range of nonprofits, in what appears to be a policy of treating lawful dissent as an act of terrorism. An NBC story revealed that the Pentagon has used a program meant to protect U.S. military installations, in order to spy on peace and other groups. In addition, FBI files released as part of a lawsuit filed by the American Civil Liberties Union (ACLU) in December 2005 show investigations of groups concerned with everything from poverty relief to the environment.