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STUDY FAULTS CHARITIES FOR VETERANS -- One charity director

goes into hiding after defying a Congressional subpoena.

Who got what grade?     AMVETS = F   Blinded Vets = D    
DAV = D     MOPH = F     PVA = F     VFW = C-     NCOA = F

To view report...go here... http://www.charitywatch.org/

Video is this story is here...
http://www.vawatchdog.org/07/nf07/nfDEC07/nf121407-10.htm

The third story below is from the Washington Post about charities for veterans.  Not good news!

But, first...two stories from ABC News...the first about the head of a vets' charity who has gone into hiding...and the second is the charities themselves making excuses about how little money they give back to vets.

First story here... http://blogs.abcnew
s.com/theblotter/2007/12/director-of-vet.html

Story below:

-------------------------

Director of Veterans Charity in Hiding

Matthew Jaffe and Rhonda Schwartz Report

The director of a national charity for veterans has gone into hiding after defying a congressional subpoena.

Roger Chapin, head of the California-based charity, Help Hospitalized Veterans, refused to appear today before a congressional hearing chaired by Congressman Henry Waxman, D-Calif., who is investigating how the charity's money was spent.

Waxman said Chapin had evaded attempts by U.S. marshals to find him for the past week to serve a warrant to compel Chapin to answer questions before Congress about his charity, which raised more than $98 million last year.

"There have been serious allegations against Mr. Chapin, including allegations that he is paying exorbitant salaries to himself and his wife, using donations to pay for questionable expenses, such as new condos, shifting funds among his various groups to skew reporting numbers and concealing millions of dollars in payments to for-profit fundraising corporations," Waxman said.

Help Hospitalized Veterans was one of more than a dozen charities for veterans rated "F" by a leading charity watchdog group, the American Institute of Philanthropy.

At today's hearing of the House Oversight and Government Reform Committee, Waxman criticized these charities for "intolerable fraud" and "a sickening betrayal of our most fundamental values."

"A disturbing number of groups are raising millions of dollars in the name of helping veterans but keeping most of the donations for themselves," said Waxman. "Instead of using the money to provide financial assistance or help veterans obtain care, these groups and the professional fundraisers they employ blatantly line their own pockets. They betray their donors and the troops who desperately need help."

"Right now there's incredible waste out there, and it's being done in the name of our brave veterans," said AIP's Daniel Borochoff. "We owe a lot more to these veterans than too many of these nonprofit groups are providing."

Ed Edmundson, whose son Eric was wounded in Iraq, fought back tears as he described how some charities "use these soldiers as a commodity to raise funds."

"I am concerned [about] the negative effect that the few self-serving nonprofits will have on the ability of the legitimate nonprofits to obtain funding from the general public," Edmundson said, choking back tears. "It would be an unfortunate turn of events if the service they provide is not available."

At one point, Waxman read a letter from former Sen. Bob Dole that called these groups "parasites" and applauded Waxman's committee for "exposing the downright fraud used by some [charities]."

"I cannot imagine anyone, or any group, stooping so low to enrich themselves by exploiting veterans' misery," Dole wrote.

Last month, Chapin walked out of an interview with ABC News' Brian Ross for a report that appeared on "Good Morning America."

Waxman said the committee will hold a second hearing on Jan. 17, 2008 and was issuing a new subpoena for Mr. Chapin today.

Second story here... http://blogs.abcnew
s.com/theblotter/2007/11/charities-respo.html

Story below:

-------------------------

Charities Respond to ABC News Report

Anna Schecter Reports:

Veterans charities rated "F" by the American Institute of Philanthropy, a charity watchdog organization, responded to ABC News'"Good Morning America."

All of the charities ABC News spoke with said they felt they were doing valuable work. While some of the groups rated "F" objected to AIP's findings, several of the charities said private fundraising companies were very expensive, but without them, they would not raise as much money for their cause.

The AIP ratings are based in large part on the percent of money raised actually spent on program services versus fundraising costs and overhead. Thirteen of the 27 received an "F."

Reading the Original Report: Failing to Serve America's Heroes on the Home Front

A spokesman for the Military Order of the Purple Heart Service Foundation defended his foundation's employment of a professional fundraising company. He said he believes donations are best utilized by providing needed assistance to veterans and not in developing at their own cost an internal volunteer fundraising program.

"We try to minimize fundraising costs and maximize returns," the spokesman said.

The NCOA National Defense Foundation took issue with AIP's methods of analysis. A spokesman denied that they spend more on fundraising than on their program services, and said that more than 70 percent of their revenue goes to programs.

A spokesman for the American Ex-Prisoners of War Service Foundation said his organization had no choice but to hire a fundraising company.

"It was better than nothing," he said. The spokesman said the foundation has recently stopped employing the private fundraising company so the percentage of funds going to fundraising will drastically change. When AIP's report comes out next year, "it will look very good," he said.

The Air Force Aid Society received an "F" based on the relatively low amount of money spent on program services compared to asset reserves. A spokesman said a large portion of its funding comes from investments; they do not receive large amounts of donations and suspect that is why they got the low grade.

The Army Emergency Relief Fund was also rated an "F" based on its relatively large asset reserves. A spokesman said they should not be penalized for having a large amount of money saved.

"We meet the demand of soldiers that come to us," the spokesman said. He added that AER gave away $70 million in assistance last year and said that good investments have grown faster than soldiers need to draw from funds.

A spokesman for the National Veterans Services Fund said the professional fundraisers they employ make it possible for them to do their job.

"We would pay the same percentage for fundraising if we did it internally, and we would reach less people," he said.

A Paralyzed Veterans of America spokesman said his charity has been doing "'A+' work for all veterans, people with disabilities and their families 24/7." He disagreed with AIP's findings and said that nearly 73 percent of all donations directly benefit veterans.

Lastly, the American Veterans Disabled for Life Memorial Fund said none of the funds have gone to the cause because they have not started building the proposed memorial to disabled veterans. Construction of the memorial adjacent to the Mall in Washington, D.C., is expected to begin in 2008, the spokesman said.

-------------------------

Third story here... http://www.washingtonpost.com/w
p-dyn/content/story/2007/12/13/ST2007121300732.html?hpid=topnews

Story below:

-------------------------

Study Faults Charities for Veterans

Some Nonprofits Shortchange Troops, Watchdog Group Says

By Philip Rucker
Washington Post Staff Writer

Americans gave millions of dollars in the past year to veterans charities designed to help troops wounded in Iraq and Afghanistan, but several of the groups spent relatively little money on the wounded, according to a leading watchdog organization and federal tax filings.

Eight veterans charities, including some of the nation's largest, gave less than a third of the money raised to the causes they champion, far below the recommended standard, the American Institute of Philanthropy says in a report. One group passed along 1 cent for every dollar raised, the report says. Another paid its founder and his wife a combined $540,000 in compensation and benefits last year, a Washington Post analysis of tax filings showed.

There are no laws regulating the amount of money charities spend on overhead, fundraising or giving. But the institute's report suggests that 20 of the 29 military charities studied were managing their resources poorly, paying high overhead costs and direct-mail fundraising fees and, in some cases, providing their leaders with six-figure salaries.

The 12 charities rated as failing by the institute -- including the Military Order of the Purple Heart Service Foundation, the AMVETS National Service Foundation and the Freedom Alliance -- collected at least $266 million in the past fiscal year.

"They know how to work the system, and they seem pretty good at not going over the line, although it is pretty outrageous that so little money is actually winding up benefiting charities," said Daniel Borochoff, president and founder of the Chicago-based institute.

The charities' practices have sparked outrage among some members of Congress.

The House Committee on Oversight and Government Reform was scheduled to hold its first hearing on veterans charities this morning.

"People want to help the veterans," said Rep. Chris Van Hollen (D-Md.), a member of the oversight committee. "They don't want to enrich organizations that are cynically exploiting veterans for their own personal gain.

"We need to make sure that the generous contributions of Americans to veterans will help veterans and not line the pockets of fundraisers and these organizations."

Richard H. Esau Jr., executive director of the Military Order of the Purple Heart Service Foundation, based in Annandale, said the cost of fundraising limits how much his group can spend on charitable causes. "Do you have any idea how much money it costs to advertise? It's unbelievable the amount of money it takes to advertise in the print and electronic media," he said. "I'm very proud of what we do, and we certainly do look after everybody. F or no F, the point is we do the right thing by veterans."

Borochoff said many veterans charities are "woefully inefficient," spending large sums on costly direct-mail advertising.

"They oversolicit. They love to send out a lot of trinkets and stickers and greeting cards and flags and things that waste a lot of money that they get little return on," said Borochoff, who plans to testify before Congress today.

The philanthropy institute gave F's to 12 of the 29 military charities reviewed and D's to eight. Five were awarded A-pluses, including the Fisher House Foundation in Rockville, which the institute says directs more than 90 percent of its income to charitable causes.

One group received an A, and one received an A-minus.

Jim Weiskopf, spokesman for Fisher House, said the charity does not use direct-mail advertising. "As soon as you do direct mail, your fundraising expenses go up astronomically," he said.

One egregious example, Borochoff said, is Help Hospitalized Veterans, which was founded in 1971 by Roger Chapin, a veteran of the Army Finance Corps and a San Diego real estate developer. The charity, which provides therapeutic arts and crafts kits to hospitalized veterans, reported income of $71.3 million last year and spent about one-third of that money on charitable work, the philanthropy institute said.

In its tax filings, Help Hospitalized Veterans reported paying more than $4 million to direct-mail fundraising consultants. The group also has run television advertisements featuring actor Sam Waterston, game show host Pat Sajak and other celebrities.

Chapin, 75, the charity's president, received $426,434 in salary and benefits in the past fiscal year, according to a filing with the Internal Revenue Service. His wife, Elizabeth, 73, received $113,623 in salary and benefits as "newsletter editor," the Post's review of the tax filing showed.

Chapin and other leaders of Help Hospitalized Veterans did not return calls for comment. But the charity e-mailed a statement stating that it is among "the finest veterans' charities this nation has to offer." The statement also said its "fundraising expenses, accounting methods, and executive salaries are comparable to other nonprofits in this field."

Bennett Weiner, chief operating officer of the Better Business Bureau, said the agency has 20 standards for reviewing charities, including that a charity's fundraising and overhead costs not exceed 35 percent of total contributions.

Weiner, who is scheduled to testify before the House committee today, said he could not comment specifically on veterans charities until after his testimony.

Advocates for veterans said they worry that scrutiny could damage military charities in general.

"In the rush to help, there's a lot of innovative work and good work happening, but there's also a lot of fraud and waste," said Paul Rieckhoff, executive director of Iraq and Afghanistan Veterans of America. "There's never been a greater need for veterans charities in a generation, and I hope issues like this don't deter people from giving."

Sen. Charles E. Grassley (R-Iowa), one of Congress's leading critics of charities, said some of the groups are abusing their tax-exempt status.

"Taxpayers are subsidizing that tax exemption," Grassley said through a spokeswoman. "Sitting on donors' money or spending too much on contracts and salaries doesn't benefit the public."

Rep. John Sarbanes (D-Md.), a member of the oversight committee, wants veterans charities to be held accountable.

"I hope there is an explanation, but it seems that most of the funds they raise never reach the veteran community," Sarbanes said through a spokeswoman. "Some of the practices being described are simply outrageous."

Rick Cohen, an expert on nonprofit groups and former executive director of the National Committee for Responsive Philanthropy, called the spending decisions of some charities "grotesque."

"I think in light of the Iraq war and the Afghanistan war, these veterans are the people who we should really be protecting and not using as excuses or avenues for ripping off charity philanthropy," Cohen said.

Staff researcher Meg Smith contributed to this report.

-------------------------

Larry Scott  --

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