A British Muslim millionaire who donated thousands of pounds to Sadiq Khan's mayoral campaign previously bankrolled a hate cleric whose TV channel described Jews as a 'cursed race' who brought the Holocaust upon themselves.

Farouq Sheikh, 59, donated £15,000 towards Mr Khan's campaign last year and is said to be friends with the newly elected London Mayor. The pair were photographed together at the Asian Business Awards in London in March.

But Mr Sheikh also donated at least £150,000 over a three-year period to a charity founded by Dr Zakir Naik, an Indian cleric who has been banned from entering Britain since 2010 for saying 'every Muslim should be a terrorist'.

Supporters: Care home tycoon Farouq Sheikh, left, and Sadiq Khan at the Asian Business Awards in London in March

The bulk of the money Mr Sheikh donated to Naik is believed to have been funnelled to the preacher's satellite channel, Peace TV, which claims to have a global audience of 100 million. The channel was reprimanded by Ofcom in February after it broadcast an anti-Semitic lecture by the late preacher Israr Ahmed.

In the speech, Ahmed said: 'That is the mark of this cursed race, that despite God's divine grace they do not take advantage of the opportunity to repent, which is why they are afflicted by great calamities, and the example is what happened to them at the hands of the Germans.'

The news that one of his donors has financed a cleric and a channel accused of anti-Semitism will be hugely embarrassing for Mr Khan after an election campaign dogged by reports that he had shared platforms with extremists.

The Labour Party itself was also caught in anti-Semitism rows after MP Naz Shah said Israel should be relocated to the United States, and Ken Livingstone said Hitler was a Zionist.

A spokesman for Mr Khan said: 'All donations were made in accordance with Electoral Commission rules. Apart from supporting the Prince's Trust, we were not aware of any other donations Farouq Sheikh had made to other organisations.' The spokesman refused to say if Mr Khan will return the £15,000.

Through their Cosaraf Charitable Foundation, care home tycoon Mr Sheikh and his brother and business partner, Haroon, 60, have donated £245,000 to two of Prince Charles's charities – the Prince's Trust and Mosaic – since 2010.

Dr Zakir Naik is an Indian cleric who has been banned from entering Britain since 2010 for saying 'every Muslim should be a terrorist'

Cosaraf started donating money to Naik through his Birmingham-based Islamic Research Foundation International (IRFI) charity in 2010, despite that being the year he was banned from the UK.

At the time, Naik was quoted as saying: 'If he [Osama Bin Laden] is terrorising the terrorists, if he is terrorising America – the biggest terrorists – then I am with him. Every Muslim should be a terrorist.'

A Prince's Trust spokesman said: 'We maintain the highest ethical standards when raising funds and do not accept donations from businesses or individuals if there are legitimate concerns. We oppose any form of racism or discrimination.'

A spokesman for the Sheikh brothers said: 'Cosaraf is a UK-registered charity that supports philanthropic causes in Britain and abroad.

'Neither it nor its trustees endorse or support extremist or anti-Semitic views in any way.

'The foundation did not knowingly donate money to any organisation that funded extremism. It ceased its donations [to IRFI] following a robust periodic review in early 2012.'