Charities for veterans pay professional fundraisers to run call centers that generate funds, then allow them to keep up to 90 percent of donations.
Six charities purportedly devoted to American veterans ranked among the 50 worst charities in the nation, which means most money donated to them never reaches the intended beneficiaries.
America’s Worst Charities, a collaboration by the Tampa Bay Times and the Center for Investigative Reporting, listed the National Veterans Service Fund (8), Vietnow National Headquarters (19), the Veterans Fund (24), the Veterans Assistance Foundation (26), Circle of Friends for American Veterans (40), and Our American Veterans (47), on its worst 50 list.
On its website, the National Veterans Service Fund says American veterans and their families “have been left without the help they need to overcome critical health and psychological problems at home.”
But over the past decade, it has paid $36.9 million to professional fundraisers and solicitors, while only paying $5.5 million to programs or direct-cash aid to veterans and their families.
In 2011, the charity raised about $9 million, with solicitors pocketing nearly 82 percent of the total.
It gave gave about $500,000 in medical assistance to veterans in need while the charity’s president, Philip Kraft, takes home an annual salary of $118,800.
Kraft says the charity buys wheelchairs, provides grocery store gift cards and pays rent for needy veterans. But no details of the grants are reported in any of the charity’s annual IRS filings, which only refer to spending on “veterans assistance and relief.”
Vietnow National Headquarters was founded more than 20 years ago to help veterans and their families. It offers help to homeless veterans and provides assistance with mental health issues, and pays for college scholarships for vets and their families. The organization is well known for its educational material about prisoners of war and Agent Orange-related health conditions.
But according to the report, the charity’s expenditures on veterans comprises only 3 percent of its annual budget. Over the past decade, Vietnow has raised $18 million through professional solicitors and paid fundraising companies $16 million of the money raised, while leaving the charity just $32,000 a year for veterans.
In 2003, Vietnow and the fundraising company Telemarketing Associates were involved in a U.S. Supreme Court case. The court examined the contract between the charity and fundraiser, where the solicitor would keep 85 percent of the donations. The court ultimately concluded that the First Amendment prohibits prescribing the amount a fundraiser can charge.
Hugh Brooks, 81, started the Veterans Fund 15 years ago to provide entertainment for America’s hospitalized veterans. It now ranks 24th among the 50 worst charities. Brooks said he originally planned to rely on volunteer performers but quickly realized his charity needed cash to put on shows. Brooks turned to professional solicitors and has paid a heavy price. He pays fundraising companies more than 80 percent of donations. Brooks said there was no negotiating with solicitors, who had their choice of veterans groups for clients.
“It was a take it or leave it deal,” he said.
Over the past decade, Veterans Fund raised $15.7 million and paid fundraising companies 82 cents of every dollar. An additional $1 million went to pay salaries at the charity, including about $40,000 a year to Brooks.
In a competitive market, it is getting harder for charities to survive and fund their programs, and increasingly they are forced to turn to professional fundraising companies that demand exorbitant fees.
Looking to curb the excesses of fundraisers, Ohio Attorney General Mike DeWine has created a register of professional fundraisers to stop these abuses and extravagant payments so that veteran charities can give their funds to the people who really need it.