Ten veterans charities that allegedly misused millions of dollars in donations are facing sanctions from California amid a nationwide crackdown on organizations that appear to manipulate the public’s goodwill for military service members.
The biggest alleged offender was Help the Vets, a charity that reportedly misused $20 million it raised over four years and did not make good on its promises to help veterans.
Some of its fundraising appeals promoted a veteran suicide prevention program that did not exist, according to an injunction released by the Attorney General’s Office and the Federal Trade Commission.
The charity’s promotions used urgent language, such as, “22 VETERANS WILL DIE EACH DAY UNLESS WE DO SOMETHING.” The number refers to Department of Veterans Affairs studies that estimate 20 to 22 veterans take their own lives every day.
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“While donors dug deep into their pockets in response to pleas for assistance, Help the Vets paid its president, Neil G. Paulson, Sr. hundreds of thousands of dollars and spent more than 88 percent of every dollar donated from 2014 through 2016 ... paying for-profit fundraisers,” the injunction reads.
The injunction bans Help the Vets from soliciting charitable contributions and must surrender its remaining $70,000 in assets. Its founder, Paulson, must pay $1.75 million to be donated to legitimate veterans charities, according to a settlement he signed in late June.
Attorney General Xavier Becerra announced the sanctions on Thursday in Sacramento. Similar press conferences took place across the country. Every state is participating in the crackdown.
“We will continue to protect veterans,” California senior assistant attorney general Tania Ibanez said. “We will continue to go after charities that are using veterans in order to solicit. And so for those of you that are out there that are using the names and the good works that veterans are doing for our nation, watch out. We’re looking at you, we’re going after you.”
As part of the campaign, Becerra announced sanctions against nine other organizations that reportedly misused donations that were intended to help veterans. Some of the settlement agreements sanctioning the nonprofits date back to last year, but they were unveiled along with the Help the Vets injunction.
Paulson, a onetime candidate for mayor in Orlando, ran several other organizations under Help the Vets that promoted specific veterans services. Two of them pledged to help veterans diagnosed with breast cancer, but did not provide any money to those veterans.
“Despite raising over $776,000 for this specific purpose, Help the Vets did not make a single grant to a veteran with breast cancer. It had no programs that provided aid to U.S. veterans suffering from breast cancer or offered grants for screening, mammography, surgery, chemotherapy, or follow up care for veterans fighting breast cancer,” the injunction reads.
Becerra said his office is applying additional scrutiny to other veterans charities. More than 500 veterans charities are delinquent on filing mandatory annual financial reports with the state, Becerra said. Over half of all veteran-related charities are in violation of registration requirements and face suspension and tax penalties if the organizations fail to remedy their infractions within 30 days.
The Federal Trade Commission and the states attorneys general also announced a public awareness campaign, called Operation Donate with Honor, that aims to teach people to recognize and avoid abusive solicitation practices.
Becerra encouraged Californians to file complaints against fraudulent practices but to continue to donate to legitimate charities.
“If you’ve taken appropriate precautions, maybe the most important tip that we can give you: please continue giving. Part of what makes California so strong is the generosity of our people, but let’s make sure our generosity actually goes to the people we’re trying to help. There are legitimate charities out there that help our family members and our neighbors, who give or have given service to our nation. My office aims to give you the tools to find them.”