A government spokesperson broke the news on Sunday, hours after a BBC investigation revealed that the cash used to form an unarmed police force in militant-held areas was being diverted to extremist groups.
According to the report, officers from the force, known as the Free Syrian Police (FSP), have been caught cooperating with militant groups. This contravenes the force’s main obligation, which was supposed to be an unarmed civilian police force.
The government spokesman said Prime Minister Theresa May and her team took the allegations "extremely seriously."
"We take any allegations of co-operation with terrorist groups and of human rights abuses extremely seriously and the Foreign Office has suspended this program while we investigate these allegations,” he said.
The FSP officers are accused of handing over funds they had received in cash to an extremist group controlling the area.
Such cases were prevalent in Aleppo province, where officers paid at least 20 percent of their salaries to the Nour al-Din al-Zinki group, which controlled the area.
The UK-backed officers had helped the group "by writing up warrants, delivering notices, and turning criminals over to the court."
The BBC report alleged that extremist groups handpicked some FSP officers while dead and fictitious people were included on the police payroll in some areas.
Citing ASI’s own documents, the report stated that the organization’s staff were unable to find any officers during a 2016 visit of a police station in Idlib province, where 57 officers were expected to operate from.
There was also evidence that some of the officers had been appointed by the Jabhat Fatah al-Sham – previously known as the Nusra Front – terrorist group.
Adam Smith International (ASI), the organization that has been running the project since October 2014, said it "strongly refutes” the allegations.
"We have managed taxpayers' money effectively to confront terrorism, bring security to Syrian communities and mitigate the considerable risks of operating in a war zone," the government spokesman said.
"ASI has managed the project successfully alongside our partner in an extremely challenging, high-risk environment under the close supervision of the Foreign and Commonwealth Office and five other governments," he added.