IRS forms show charity's money isn't going to disabled

    • Moderator
    • 16870 posts
    January 27, 2013 4:47 AM PST

    Birmingham, Alabama (CNN) -- A national charity that vows to help disabled veterans and their families has spent tens of millions on marketing services, all the while doling out massive amounts of candy, hand sanitizer bottles and many other unnecessary items to veteran aid groups, according to a CNN investigation.

    The Disabled Veterans National Foundation, based in Washington, D.C., and founded in 2007, received about $55.9 million in donations since it began operations in 2007, according to publicly available IRS 990 forms.

    Yet according to the DVNF's tax filings with the IRS, almost none of that money has wound up in the hands of American veterans.

    Instead, the charity made significant payments to Quadriga Art LLC, which owns two direct-mail fundraising companies hired by the DVNF to help garner donations, according to publicly available IRS 990 forms.

    Those forms show the charity paid Quadriga and its subsidiary, Brickmill Marketing Services, nearly $61 million from 2008 until 2010, which was the last year public records were available.

    The independent group CharityWatch gave the DVNF an "F" grade. More than 30 veterans charities were rated by the independent group by the amount they spend on fundraising compared to actual donations, and two-thirds were given either a D or F grade, according to CharityWatch president Daniel Borochoff.

    "Up to $2 billion is raised in the name of veterans in this country and it's so sad that a great deal of it's wasted," Borochoff said. "Hundreds of millions of dollars of our charitable dollars intended to help veterans is being squandered and wasted by opportunists and by individuals and companies who see it as a profit-making opportunity."

    WEWS: Suspect accused of stealing millions through phony veterans charity

    On its website, the DVNF posted a "news bulletin" announcing that the charity had sent badly needed goods "by the truckload" to veterans centers in Birmingham, Alabama, in the wake of last year's devastating tornados.

    DVNF specifically cited a small veterans charity called St. Benedict's. But the charity's executive director said most of the donations from DVNF could hardly be classified as "badly needed."

    "They sent us 2,600 bags of cough drops and 2,200 little bottles of sanitizer," J.D. Simpson told CNN. "And the great thing was, they sent us 11,520 bags of coconut M&M's. And we didn't have a lot of use for 11,520 bags of coconut M&M's. "

    Simpson said the DVNF also sent him more than 700 pairs of Navy dress shoes, which he said he can't use. He has put them up for purchase at a yard sale.

    In its tax filings, the DVNF also claims to have sent millions of dollars of so-called "Goods In Kind" to smaller veterans-related charities around the nation.

    In one instance, the DVNF claimed more than $838,000 in fair market value donations to a small charity called US Vets in Prescott, Arizona.

    CNN obtained the bill of lading for that shipment, which showed that, among other things, hundreds of chefs coats and aprons were included in the delivery, along with a needlepoint design pillowcase and cans of acrylic paint. The goods listed in the two-page shipping document were things "we don't need," a US Vets spokesman said. And at the bottom of the bill of lading, the DVNF itself estimated the value of the shipment at around $234,000 -- significantly less than the $838,000 it reported to the IRS.

    CNN has attempted to get a comment from the DVNF for more than a year, but has received no specific replies, even after submitting several questions in writing.

    When approached by a CNN crew at the Veterans of Foreign Wars hall in Baton Rouge, Louisiana, Disabled National Veterans president Precilla Wilkewitz rebuffed questions.

    "Well, this is the Veterans of Foreign Wars and I really didn't think you'd do something like this and we've agreed to talk to you ... answer your questions," she said, standing in the entranceway to her office.

    Wilkewitz is the former national legislative liaison for the VFW, which is not directly tied to the Disabled Veterans National Foundation.

    She said she would answer questions only in writing, but so far CNN has received no response.

    When asked about Quadriga's relationship with DVNF, spokesman Ron Torossian told CNN in an e-mail that the company is privately owned and "we do not discuss specific client relationships." But according to IRS filings, Quadriga has been paid for direct-mail services by DVNF since the charity was founded in 2007.

    Torossian did say in his e-mail, "At times, Quadriga chooses to invest money in partnerships with non-profit organizations. Sometimes it is a successful business venture, while others it is not."

    In a subsequent e-mail, Torossian said Quadriga had lost $7 million investing in veterans nonprofit organizations.

    When CNN asked whether that included the Disabled Veterans National Foundation, he said "your facts remain woefully inadequate," but he declined to elaborate in a later e-mail exchange. He also threatened to sue CNN on behalf of Quadriga.

    At the small house in Birmingham where J.D. Simpson operates St. Benedict's, he said his main goal is to provide beds to homeless and disabled veterans.

    He characterized the DVNF operation in harsh terms.

    "I ask myself what the heck are these people doing stealing from our veterans. because that's what they are doing," Simpsons said. "I don't care how you look at it. These people have sacrificed for our country. And there are some people out there raising money to abuse 'em and that just makes me mad."


    • Moderator
    • 19067 posts
    January 27, 2013 7:21 AM PST
    WOW, sounds like a bit (actually a lot) of money laundering going on there. If these facts are true I surely hope some DA get on their ass. Thanks Rev.
    Purple Heart is who I donate to.
  • January 27, 2013 11:43 AM PST
    Thanks for the info. Wounded Warriors Project is where all my donations have been going the last few years.
    • 1855 posts
    January 28, 2013 1:56 AM PST
    wheels wrote...
    Thanks for the info. Wounded Warriors Project is where all my donations have been going the last few years.

    Mine too as well as paralyzed veterans.  It is however, strange that both these charities are able to spend a great deal on public relations, advertizing, and sending out gifts like calendars, pens, address labels, and such.  It makes me wonder if all the gift giving is from donating corporations or what.  Hell, THAT money has to come from somewhere.

    It may seem like I'm doubling up donations for the same cause but Paralyzed Vets is just that, whereas Wounded Warriors encompasses a great many Veteran issues.   Still, regardless of who you send funds to, ya just never know.  And BTW, on the Charity Watchdog site they too ask for donations. My opinion, the Watchdog for Veteran's charities should be the DOD or even VFW.
  • January 28, 2013 2:14 AM PST
    It makes me mad to think I'm doing something good with my money and then find out it just goes to corporate greed. Another reason why I don't donate over the phone, no matter who calls.
  • January 28, 2013 9:29 AM PST
    While it is simple to donate and move on, as a donor you need to do some homework. Many organizations including the Red Cross, United Way and others have received criticism and law suites because of how they deal with the money given. If a Charity CEO is making 500K plus a year (or more) - somethings up.
  • January 28, 2013 9:37 AM PST
    petrusrock wrote...
    While it is simple to donate and move on, as a donor you need to do some homework. Many organizations including the Red Cross, United Way and others have received criticism and law suites because of how they deal with the money given. If a Charity CEO is making 500K plus a year (or more) - somethings up.

    I think this is the best solution.  Do your homework, find a charity that you support, and donate.  Then, when you take cold calls from charitable organizations that you've never heard of, tell them you don't do business over the phone and hang up with no guilt, knowing that you have already done your part to support a worthy cause.

    • 5420 posts
    January 28, 2013 9:45 AM PST
    wolfpack wrote...
    petrusrock wrote...
    While it is simple to donate and move on, as a donor you need to do some homework. Many organizations including the Red Cross, United Way and others have received criticism and law suites because of how they deal with the money given. If a Charity CEO is making 500K plus a year (or more) - somethings up.

    I think this is the best solution.  Do your homework, find a charity that you support, and donate.  Then, when you take cold calls from charitable organizations that you've never heard of, tell them you don't do business over the phone and hang up with no guilt, knowing that you have already done your part to support a worthy cause.
    Remember there are a number of trustworthy charities that use volunteers to make these calls... I actually have done it for a couple of local charities myself.  Many you may not have heard of, like the local animal rescue I recently did some calling for - small group, 100% volunteer and 100% of the money went to the rescue, so very few people heard of them.

    If I get a call from a charity that sounds like I would be interested in donating to, I always ask them for a number I can call back or their mailing address.  That way I can do some research and get back to them if I find they are trustworthy.  Anyone who cannot let me get back to them, I hang up on.