President Donald Trump's far-reaching travel ban could be used as fuel for terrorist groups in the affected areas to turn people against the United States, perpetuating the terrorist threat, International Rescue Committee CEO David Miliband told CNBC on Monday.

"This is a propaganda gift for all those who would do harm to the United States," Miliband told "Squawk Box." "We ... know that ISIS and others are saying that the only people who will defend Muslims are them, and that's obviously very dangerous."

Trump said the ban does not target people by religion and the travel restrictions were similar to a six-month ban by the Obama administration on visas from Iraq in 2011.

Miliband said that the hasty order and its chaotic implementation were flawed for a number of reasons. He took issue with the isolation of people in the Middle East, namely Iraq, who help the U.S. military run its operations.

He said that the International Rescue Committee is supposed to resettle about 3,500 of them, most of whom are translators or have similar supporting jobs, in the United States this year.

"These are people who have literally risked their lives for the national security of the United States," he said. "They are targeted in Iraq for supporting the U.S., and so the substance of the policies really needs to be looked at."

The other countries on Trump's order are Libya, Iran, Somalia, Sudan, Syria and Yemen.

Miliband also argued that "hasty policymaking makes for bad policy," and that the administration would have been better off conducting a review of the vetting policies that were already in place before imposing any kind of ban.

Responding to Kellyanne Conway, who spoke on CNBC earlier Monday about the ban, Miliband said he would encourage the administration to backpedal, and backpedal fast.

"I would say to her, it's always tough to do a U-turn," said Miliband, a British Labour Party member and former foreign secretary of the United Kingdom. "The green card change is the first of the minor U-turns. But I've been in government. I know it's much better to do a U-turn fast than to have it pulled out of you over months and years."