Legal aid chiefs are seeking to recover court defence costs from Muslim cleric Abu Hamza al-Masri amid reports that he bought a £220,000 house while in jail.
Recovery proceedings are on hold while Abu Hamza al-Masri appeals
Recovery hearings have been held after an investigation into the cleric by the Legal Services Commission (LSC).
The Evening Standard has reported that he purchased the property in Greenford, west London, in October 2004.
Abu Hamza al-Masri was jailed for seven years in February for soliciting murder and inciting racial hatred.
The newspaper said he bought the four-bedroom semi-detached house despite his assets being frozen by the Treasury under anti-terrorism measures.
The legal aid costs were in the region of £250,000, it added.
David Keegan, the director of the Legal Services Commission's Special Investigations Unit, said they were the process of applying for a Recovery of Defence Costs Order (RDCO) to be imposed on Abu Hamza Al-Masri.
"The investigation into Abu Hamza's assets by the LSC's Special Investigations Unit to support the granting of an RDCO continues," he said.
"In order not to prejudice our application for an RDCO, we cannot go into further details of our investigation.
"If an RDCO is imposed it will ensure that Abu Hamza pays some, if not all, of the legal costs for his defence against the terrorism charges."
The most recent recovery hearing took place at the Old Bailey on 29 June.
The next one was due on 31 August but the process has been put on hold because al-Masri is appealing against his convictions.
A Treasury spokesman said: "It should be made clear that it is not permitted for designated terror suspects to transfer any form of funds and assets, including property."