The face of 2010's controversy over a proposed mega-mosque and community center near Ground Zero in Manhattan has been accused of defrauding donors in a lawsuit filed in New York state court this week.

Feisal Abdul Rauf and his wife Daisy Khan bought "a luxury sports car, personal real estate" and traveled on money that was donated for specific projects at Rauf's Cordoba Initiative and the American Society for Muslim Advancement (ASMA), the lawsuit says. It was filed by Robert Leslie Deak, whose family foundation donated $167,000 to Rauf's "Shariah Index" project from 2006-08. The money was supposed to be used for Islamic scholars to work to reduce anti-Muslim sentiment.

In addition, the lawsuit claims, Rauf failed to report $3 million in donations from the Malaysian government on his non-profits' tax forms and that Rauf also used the money on personal spending. The lawsuit seeks $5 million in punitive damages.

Rauf's attorney denied the allegations. This is not the first litigation between the two sides. Rauf and Khan sued Deak and his wife in 2010, alleging the Deaks sold them a Washington, D.C. apartment at a grossly inflated price. The apartment was to house Cordoba's national office. But, as columnist Juan Gonzalez notes, the sale price was $1.5 million, and Cordoba's tax returns indicate the initiative spent $792,000 that year.

"How do you manage to pay $1.5 million for a D.C. office the same year your organization claims it only spent half as much money in all?" Gonzalez wonders.

During the Ground Zero mosque controversy in 2010, the Investigative Project on Terrorism reported that other donations to ASMA and Cordoba were not listed in tax returns. A review of IRS forms also found that ASMA secured its non-profit status in 1998 by promising to serve as a house of worship to up to 500 people per day. But the group gave an address of New York apartment that had no communal space and Rauf's only prayer services took place at other mosques in New York.

ASMA also told the IRS in 1998 that it had a school "for the religious instruction of the young," but the group's website made no reference to its operating a school.

In addition, Cordoba's application for non-profit status claimed the group was not an outgrowth of, or connected to, other organizations. That was contradicted by a 2009 ASMA financial statement that said "ASMA is acting as a fiscal agent and is developing Cordoba's ability to function independently."

Rauf's group never had the financing to realize its grand ambition of a $100 million mosque and community center. The disputed location remains largely unchanged, although prayer services do take place inside. Rauf left the mosque group in 2011.