Disgusting and Disillusioning Veterans Charities

by Gary Snyder

Nonprofit Imperative has highlighted the fraud that has taken place on the backs of our Vets. (see a few: here, here, here). We probably have uncovered 50-100 questionable veteran organizations

We have advised that at a minimum, check with charity watchdogs (Charity Navigator, BBB, GuideStar) to find out if the charity is legit.

Here is a story that I commend to you on that very topic:

Vet Your Veterans Charities - The Allied Veterans of the World Scam

Lisa Cypers Kamen, MA

As the founder of a nonprofit for veterans, I'm a little more disheartened each time I hear about another veteran charity misleading the public. The latest scam, which rightly has the entire Sunshine State up in arms, is yet another example of why we need to vet our veterans charities.

In case you haven't heard about the scandal yet, here's a quick debriefing: Allied Veterans of the World, a nonprofit founded in 1979, claims to contribute "time, money and support services to veterans and first-responder organizations across the country." Visit its website, and you'll see a furling American flag with the words "Veterans Helping Veterans" scrawled in patriotic red and white. Read the text on its home page, and you'll learn that the organization has donated major bucks to Veterans Administration hospitals and clinics. Or so they say.

How does the Allied Veterans of the World raise its money? Through 49 gambling parlors across Florida, where customers can play computerized slot-machine type games. Drop in some change, and even if you lose, it's a win-win, because the money you lose goes to our veterans in need. Except that in reality, it doesn't. This week, investigators arrested more than 50 people tied to the gambling scam after developments allegedly show the organization has given veterans less than 2 percent of the $300 million it has made in the last 5 years. Instead of helping our veterans get health care, it helped Allied Veterans of the World execs get boats, real estate, and shiny toys by the name of Maseratis, Ferraris and Porsches. The parlors are shutting down, and Florida's Lieutenant Governor, although not tied to any wrongdoing, has resigned simply because she was backed by the organization.

If this was the first time a veterans charity had failed us, it would still be sad, but not so tragic. But a quick tour de news over the last few years shows that the Allied Veterans of the World scandal is a symptom of a larger trend. Just last spring, the Disabled Veterans National Foundation was accused of spending most of its $56 million raised to pay for consultants and advertising. Few dollars actually went to veterans, though donors were told otherwise. And then there's the case of the U.S. Naval Veterans Association, which raised more than $100 million in seven years. None of the organization's members actually existed, and its address was a post office box at a UPS store in Washington DC. The "nonprofit" gained credibility by listing thousands of fake donors and ensuring the public its "members" were veterans. Needless to say, they weren't. The guy running the organization, John Donald Cody, a former military intelligence officer, had been on the FBI's most wanted list for decades for alleged espionage and fraud. He now sits in jail in Ohio facing charges of fraud, theft and money laundering, all tied to the U.S. Naval Veterans Association.

And if that isn't disheartening enough, there's this news: Nearly half of the 39 veterans charities that the American Institute of Philanthropy rated in April/May 2011 were given big fat Fs. Why did they fail? In most cases, the money backed fundraising campaigns and executives, not veterans.

Fraud among veterans charities has gotten so bad that it was the subject of congressional hearings in 2007, and it's been a source of public outrage ever since. Rightly so. The public has every right to be leery, skeptical, disgusted and disillusioned by veterans charities that use their generous donations for everything but veterans aid.

As the founder of the nonprofit Harvesting Happiness 4 Heroes, I'm just as outraged by these scams as you are. It is morally wrong and ethically bankrupt for these organizations to literally capitalize on our desire to help deployed and returning veterans. And even more frustrating is that of all the times in recent history, our veterans need us most right now, just as these scams are making veterans donations dwindle. Amid soaring rates of suicide, PTSD, unemployment and multiple deployments, our veterans are returning home to a stark, unfortunate reality that keeps them from transitioning into civilian life.

Although though there are many bad eggs in the dozen, veterans charities still serve an important purpose. Our Veterans Administration doesn't have the funds to adequately support our troops, plain and simple, and when operating in good faith, nonprofits are a good way to close this funding gap. The problem is, with each scam that hits the news, legitimate charities that are truly set on doing good see fewer fundraising dollars trickle in.

Don't let the scams and lies deter you from supporting our Warriors; instead, use them as motivation to truly vet a veterans charity before making your contribution. One easy way to do so is to visit Guidestar, the Gold Star of nonprofit vetting and an invaluable database for finding trustworthy charities that have their hearts in the right place. It's what we subscribe to at Harvesting Happiness 4 Heroes, and it's what has vetted us so that the public knows what we're doing with the money we collect through our programming.

Yes, it's sad that we have to do a little investigating to find the veteran charities that do what they say they do. But once you find a charity that you trust, your tie to the cause will be that much stronger. Giving is always best when you have no inhibitions about it, and when you're confident that it is supporting a good cause. It may take a bit of vetting to support our veterans, but it's a cause well worth the effort.

Nonprofit Imperative gathers its information principally from public documents...some of which are directly quoted. Virtually all cited are in some phase of criminal proceedings; some have not been charged, however. Cites in various media: Featured in print, broadcast, and online media outlets, including: Vermont Public Radio, Miami Herald, National Public Radio, Huffington Post, The Sun News, Atlanta Journal Constitution, Wall Street Journal (Profile, News and Photos), FOX2, ABC Spotlight on the News, WWJ Radio, Ethics World, Aspen Philanthropy Newsletter, Harvard Business Review, Current Affairs, The Chronicle of Philanthropy, St. Petersburg Times, B, USA Today Topics, Newsweek.com, Responsive Philanthropy Magazine, New York Times...and many more Nonprofits: On the Brink (2006) Silence: The Impending Threat to the Charitable Sector (2011)