Section 3 of the GPL2 states:
You may copy and distribute the Program (or a work based on it, under Section 2) in object code or executable form under the terms of Sections 1 and 2 above provided that you also do one of the following:
a) Accompany it with the complete corresponding machine-readable source code, which must be distributed under the terms of Sections 1 and 2 above on a medium customarily used for software interchange; or,
b) Accompany it with a written offer, valid for at least three years, to give any third party, for a charge no more than your cost of physically performing source distribution, a complete machine-readable copy of the corresponding source code, to be distributed under the terms of Sections 1 and 2 above on a medium customarily used for software interchange; or,
c) Accompany it with the information you received as to the offer to distribute corresponding source code. (This alternative is allowed only for noncommercial distribution and only if you received the program in object code or executable form with such an offer, in accord with Subsection b above.)
Therefore the licensee would need to provide the complete corresponding machine-readable source code OR provide a written offer (valid for 3 years) to distribute a complete machine-readable copy of the source code for a fee.
It sounds like they have gone down the route of the written offer since it is alleged they are potentially charging for it. It's fine that the source code is in machine readable format.
Section 1 of the GPL1 allows the licensee to charge a fee:
You may charge a fee for the physical act of transferring a copy
however it's unclear how applicable this is to digitally-distributed source code hosted on repositories like GitHub. I imagine it is possible that the "physical act" of downloading a copy of the source code to distribute might count, but it would be open to a court to disagree and I haven't researched any potential case law on the matter.
In conclusion, as long as the complete machine-readable source code is provided upon request, the licensee does not appear to be violating the terms of the GPL2.