JERUSALEM—Sen. Tom Cotton, R-Ark., recently sent a letter to the head of the U.S. Agency for International Development, disclosing that some of the $1 billion in American taxpayer money was likely diverted to Hamas.

Cotton’s shocking claim came just weeks after the U.S.-designated terrorist organization, Hamas, executed the 23-year-old American-Israeli Hersh Goldberg-Polin in late August.

Cotton slammed the main U.N. relief agency for Palestinians in the Gaza Strip, known as the United Nations Relief and Works Agency (UNRWA),

Humanitarian aid trucks from the United Nations and the World Health Organization are waiting in the Central Gaza Strip to enter the north of the Strip via Rashid Street on April 25, 2024. The aid is intended for hospitals and includes, among other things, medicine, food and fuel. (Photo by Majdi Fathi/TPS)

A spokesperson for the U.S. State Department told Fox News Digital, “The United States ceased funding UNRWA in January immediately following knowledge of allegations that some UNRWA staff may have participated in the heinous October 7th attacks.”

The spokesperson added “In March, the U.S. Congress prohibited any U.S. funding of UNRWA through at least 2025. We have and continue to redirect our assistance to other partners and avenues to help Palestinians. We support steps to strengthen UNRWA impartiality and neutrality, including to respond to allegations of ties to terrorism. “

According to the State Department spokesperson, “UNRWA is not a terrorist organization.  We appreciate UNRWA’s critical role in providing life-saving assistance to Palestinians and essential education, health, relief and social services programs and emergency assistance in Gaza and the West Bank, Jordan, Lebanon, and Syria.”

Sen. Tom Cotton, R-Ark., questions President Biden’s pick to lead the Bureau of Alcohol, Tobacco, Firearms and Explosives, Steven Dettelbach, on Wednesday, May 25, 2022, during a Senate Judiciary Committee hearing. (Pool Video)

In July, Israeli lawmakers approved the first reading of a bill that would cut ties with the controversial UNRWA agency and declare it a terrorist entity. Knesset member Yulia Malinovsky, the bill’s sponsor, called UNRWA “a fifth column within the State of Israel” and said it was high time that the agency was outlawed in the country.

Congress’ House Foreign Affairs Committee passed initial legislation in July that would build on an already existing funding freeze of the multimillion-dollar organization and direct the State Department to recover previously donated monies.

After Israel revealed that UNRWA employed Hamas terrorists, including many who reportedly participated in the massacre on Oct. 7, the U.S. suspended aid to UNRWA. 

Deere said that “Left out of Senator Cotton’s analysis was the fact the Israeli Government had not informed UNRWA since 2011 of any concerns relating to Agency staff.”

A spokesman for Cotton told Fox News Digital in response to UNRWA’s charges that, “Administrator Power and USAID do not have an adequate vetting process to ensure that American taxpayer dollars do not end up with terrorists. If a terrorist front organization like UNRWA is the only “distribution system” in Gaza, Power should reconsider sending aid there in the first place. Our tax dollars should not fund a group that has assisted in the kidnapping and murder of Americans.” 

Former President Donald Trump’s administration had pulled the plug on UNRWA. The Biden administration quickly restored funding. 

Palestinians, who left their homes and took refuge in Rafah city under hard conditions, carry the flour they received in the area where UNRWA distributes flour to families as Israeli attacks continue in Rafah of Gaza on Jan. 28, 2024. (Abed Zagout/Anadolu via Getty Images)

Last week, Israel’s mass circulation daily, Israel Hayom, reported that “The Israel Land Authority (ILA) is seizing the land of UNRWA’s headquarters in Jerusalem, in order to build 1,440 housing units.”

The paper said “As the extent of UNRWA and its employees’ collaboration in the massacre at Gaza border communities by Hamas and their role in providing assistance for murder, kidnapping, and more continues to be revealed, a significant step has been taken for the first time against the refugee agency.”

Fox News’ Ruth Marks Eglash contributed to this report.