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Now the NCADC, which has offices in Manchester, London and Middlesbrough, is being forced to close after funding dried up.
The group's co-ordinator John O, who lives in Lozells, said the NCADC had become "too hot to handle" and that registering as a charity was not an option.
Home Secretary David Blunkett ordered an investigation after it emerged the NCADC, which is based in Handsworth and run by John O - formerly known as John O'Reilly - was backing failed asylum seekers' attempts to avoid being sent home.
The Community Fund was criticised for failing to take the NCADC's political campaigning into account, particularly as its website accused Mr Blunkett of 'colluding with fascism'.
That would be double punishment." The NCADC has also helped Mukhtiar Singh, 27, and Paramjit Singh, 26, who fought extradition after being arrested for plotting to smuggle explosives from Pakistan to India and planning terror attacks.
'But all of the above named individuals have been allowed to stay legally in the UK as a result of decisions by Jack Straw or David Blunkett, following campaigns supported and advised by NCADC.
Kath Sainsbury, from the North-east office of the NCADC, said: "The family is frightened to death.
The Home Office previously said that officials believed they could prove the NCADC was involved in direct political campaigning, which would make it ineligible for the payment.
'The Government set out its detailed concerns about the grant that the Community Fund hopes to give to the NCADC,' said a Home Office spokeswoman.
One of the NCADC's roles is backing asylum seekers' attempts to avoid being sent home.
Chiefs from the Lottery's Community Fund met government officials in the wake of concerns about the activities of the National Coalition of AntiDeportation Campaigns (NCADC), which has just been awarded pounds 340,000.
The investigation will centre on the extent of NCADC's political activity, particularly its opposition to the Government's asylum policy, which includes speeding up the deportation system and reducing failed applicants' rights of appeal.
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