Iraqs media commission Monday slapped a three-month suspension on the US-funded Alhurra TV for airing a controversial report alleging corruption in the countrys powerful Sunni and Shiite religious institutions. The 12-minute documentary broadcast on Saturday claimed that the religious authorities were misusing state funds and had suspicious ties to armed factions. Iraqs Communications and Media Commission said it found the report lacking professionalism, balance, and reliable evidence. It ordered a "suspension of Alhurra Iraqs license for three months and a halt to its activities until it corrects its position" and demanded that it broadcasts a formal apology. "These steps are tantamount to a final warning to the station, and a tougher punishment will be taken in case this offence is repeated," the statement said. Founded in 2004, the channel is widely-watched in Iraq and part of the wider Alhurra network, which is funded by the US Congress and directed from Washington. The controversy comes at a time of heightened tensions between Baghdads two main allies Washington and Tehran, with pro-Iran factions ratcheting up their discourse against the US. Alhurra stood by their report in a statement, calling it “fair, balanced and professional.” “During the extensive preparations of the report over time, individuals and institutions were given the right of reply, which they declined. We still offer those same institutions the opportunity to reply.” Alhurras report prompted an avalanche of condemnations, with critics suggesting it showed the US was adopting an aggressive stance towards their country. The Popular Mobilization Forces accused Alhurra of having "a hostile news policy". Qais al-Khazaali, who heads the Asaib Ahl al-Haq faction within the PMF, slammed the report as "a dangerous indication of US foreign policy". Iraqs Sunni religious establishment said the report was full of "lies," and said it was preparing a lawsuit against Alhurra. But the Journalistic Freedoms Observatory said the media commissions decision was "rushed and illegal". "This is the first time in five years such a quick step has been taken against a media organization," said Observatory head Ziad Al-Ajili. "The commission can give its opinion on the journalistic quality of a documentary, but it should have referred the case to the Iraqi judiciary," Ajili told AFP. Neither the US Department of State nor the US Embassy in Baghdad oversees the content of Alhurra’s programming, Embassy Spokesperson Pedro Martin said. “Alhurra’s mission is to deliver accurate and objective information on the region, American policies and Americana,” he said, according to Reuters. “The Government of Iraq has the right to question Alhurra on any reporting that is perceived to be false or unprofessional and has the right to respond with their position.” Graft is endemic in Iraq, which is ranked the 12th most corrupt country according to Transparency International. While Iraqis regularly criticize government figures, it remains taboo to speak ill of the countrys revered religious authorities.