There are several clear signs that the term is a fraud -- the letter ذ or dh is often rendered into a z sound in various colloquial dialects of Arabic, or sometimes into a th, and is difficult to pronounce for English speakers anyway.  The proper transliteration should be "mufakhadha," (no t at the end, that's another giveaway that this is being written about by people who don't really speak or read Arabic) but a Google search for that spelling yields zero results.  There are several other possible (colloquial) transliterations, but those are even less common in Google than the given one, with most yielding zero results and only one returning less than 300 hits, most of which are the same.

The use of an apostrophe is just bizarre and is an even clearer sign that this is BS.  An apostrophe is used in some methods of transliterating Arabic to substitute for specific letters, but none of them are in this word.  It just doesn't belong there.  Full stop.

Finally, as I mentioned, the "t" at the end of the word is another sign.  It's a little too complicated to explain here, but there's a letter ة called ta marbouta that often ends nouns of feminine gender.  Its pronunciation changes from a soft a to at depending on context.  On its own, normally it would be transliterated as an a, not at.

So the transliteration "mufa'khathat" is just plain illiterate and incoherent.  Clearly the term is being used almost entirely by people who don't know Arabic at all, because even a rank beginner wouldn't have transliterated it that way.

I did Google the term in Arabic, though, and got a whopping 497 results, most of them repetitive and similar to this one, a fatwa calling the practice "illegal" and imported from "pornographic films sent by the infidels and the enemies of Islam."  FWIW.