American leaders speak of the importance of negotiations between Israel and the Palestinian Authority, but American money is being used by terrorist groups that undermine the chance for peace, according to a report by NGO Monitor that was presented Monday to the United States Congress.

The problem is with the funding dispersed by U.S.-funded NGOs, explained NGO Monitor head Professor Gerald Steinberg. He named USAID and the National Endowment for Democracy (NED) as two organizations funded by the U.S. government that in turn fund local Arabs groups, some of which work against the U.S. government’s stated goals.

One example given in the report is the case of MIFTAH, a Palestinian Authority-based NGO. The NED give MIFTAH over $178,000 from 2007 to 2012.

MIFTAH is “centrally involved in anti-Israel campaigns and antisemitism, including repetition of the infamous blood libel and allegations of ‘the slaughter of Palestinian children,’ ‘massacre,’ ‘cultural genocide,’ ‘war crimes,’ and ‘apartheid,’” the report stated.

NED agreed to fund MIFTAH based on its own evaluation of its activities, without an independent evaluation.

A second NGO, Windows’ Youth Media Program, received $750,000 from USAID. While the group is ostensibly “a tool for Israeli and Palestinian participants to learn about each other and to communicate with each other about the conflict,” according to its own description, in reality it has become “a platform for incitement and promotion of conflict, including comparisons between Israel and Nazi Germany,” NGO Monitor reports.

USAID also gave over $1.6 million to the Parents Circle Family Forum, a group for Jewish and Arab bereaved parents. NGO Monitor noted that the group is highly controversial in Israel due to its one-sided presentation of the conflict, including the use of the term “Nakba” (literally “disaster”) on one of its Facebook pages to refer to the establishment of the modern state of Israel.

Some U.S.-funded groups even expressed open support for terrorism. The Palestinian NGO Network, which received an NED grant of over $34,000, stated that a clause against terrorism that the U.S. asked NGOs to sign “ignores the legal Palestinians’ right of resistance against the Israeli occupation.” A second NED-funded Arab NGO, Al-Dameer, similarly referred to terrorism as the “right to resist.”

NGO Monitor criticized a response from NED as self-contradictory. NED stated in response to NGO Monitor’s findings, “NED is a bipartisan American institution whose mission is to help build peaceful civil societies. Accordingly, it does not take positions on matters of public policy or controversy… We would not withdraw support for a group simply because its views on issues, or the language its members use to describe events, may be controversial or even in some respects objectionable.”

“This response negates the moral and legal responsibility of the funder for the activities of the grantee, and the clear contradiction between hate speech and ‘democracy-building projects,’” NGO Monitor stated.

NGO Monitor proposed that U.S.-government linked funding agencies be required to take NGOs’ agendas into account when making decisions regarding funding, rather than focusing only on specific projects.

While NGO Monitor was critical of current policy, it praised the U.S. government for its willingness to reconsider. “It should be noted that the U.S. government’s responsiveness and willingness to ‘review carefully’ its policies stand in sharp contrast to the secrecy practiced by many European countries and, in particular, the European Union,” the group said.