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May 23rd, 2012
05:18 PM ET

Tonight on AC360: Senator launching investigation into vet charity

Our Keeping Them Honest reports on the donations collected by the Disabled Veterans National Foundation (DVNF) have gotten the attention of lawmakers on Capitol Hill. Senate Finance Committee Chairman Max Baucus is demanding answers from DVNF. The Montana Democrat, along with Republican committee member Sen. Richard Burr of North Carolina, has launched an investigation to determine if the charity is abusing its tax-exempt non-profit status.

As we've been reporting for weeks, tax records show DVNF raised nearly $56 million over three years. But here's the problem: Not one dime has gone directly to help disabled veterans. Instead, CNN's Drew Griffin discovered the charity sends free stuff to veterans groups - stuff they say they didn't ask for and don't need. We're talking about thousands of bags of coconut M&Ms, bulk shipments of chef's aprons and military dress shoes. The veterans groups have had to sell the items to raise money so they could buy items vets actually do need.

So, where did the nearly $56 million donated by Americans go? Griffin followed the money trail to a company called Quadriga Art, a company that specializes in fundraising. Quadriga Art and its subsidiaries have more than 500 charities on their client list, including DVNF. A source who had first-hand dealings with Quadriga tells us it’s the "financial equivalent of heroin addiction for charities."

Tonight on 360°, Griffin reports on the Quadriga connection to veterans charities. Plus, Anderson Cooper talks with Sen. Baucus about his investigation. Watch the preview and tune in at 8 and 10 p.m. ET

soundoff (10 Responses)
  1. Aaron

    And then there's TroopsDirect. An organization that actually DOES help out our troops

    May 25, 2012 at 12:01 pm |
  2. dtg in Montana

    Yes this organization is dispicable, however I don't know if Sen. Baucus and his cronies will get anything done about it. He's just another mouthpiece and no action in the Senate! Not holding my breath!

    May 24, 2012 at 9:55 am |
  3. BeverlyNC

    Susan Komen is another fake charity. Her sister set herself up a breast cancer charity, pays herself $500 K a year, and then turns out to be an extremist Republican who cut Komen funding off for Planned Parenthood – which is the only way low-income women can get mammograms. So what does Komen really do with all the money they raise? Lost all credibility and should lose therir tax-exempt status if Suan Komen's sister can pay herself $500 K a year. Komen is a fraud and there are other credible charities for women out there.

    May 24, 2012 at 12:04 am |
  4. sockpuppet2

    I agree and I bet there are more. But don't just look at that one. Look at the major ones like American Heart Association, American Diabetic Association, Livestrong, WWF, AARP, etc. They look like fronts also. They take money from people by playing on their sympathy and then get people to call congress to vote a certain way that helps them, or they dispense information that harms people's health while the groups they are fronting for are making money off of sick people.

    May 23, 2012 at 11:17 pm |
  5. enrique garcia

    This is so sad you know the veteran they shud be taking care this mens & woman they served the country and die for this country that sik those people they need to ponech l can belive they spending the donations they dont deserved is very sad well hope this people paid for they did

    May 23, 2012 at 10:16 pm |
  6. Bob Engelbardt

    Recently, I received a large envelope in the mail from DVNF containing, among other "gifts", a large solar powered electronic calculator, an appointment book with my name embossed and a fine quality ball point pen with my name on it.

    I wrote a letter to DVNF suggesting that instead of sending unrequested items to potential contributors, they should report on what percentage of donated funds actually reach veterans organizations similar to Doctor's Without Borders and other charities. I indicated that their minimum requested donation of $12 would in no way cover the cost of the "gifts" and other expenses of the third party promoters who actually handle the donation request programs.

    The AC360 story today confirms my suspicions that orgqanizations like DVNF which arrange to send lavish, unsolicited gifts to potentional donators must result in little or no funds ever reaching the charities with which they contract for their promotional services.

    May 23, 2012 at 10:11 pm |
  7. Clayton from VA

    It was stated that DVNF is stuck in this multi-year contract and no ideas were mentioned as to what is in it for the DVNF doing business with Quadriga. DVNF managers collect a salary. Are these salaries very high? I remember a news story about the CEOs of non-profits receiving huge salaries. A non-profit corporation in the end makes no profit, but their managers and employees salaries are part of the organization's overhead before the bottom line of no profit.

    Maybe some of the DVNF managers sit on the board of Quadriga? Maybe it is darker than that, DVNF managers could be getting kick-backs from Quadriga. DVNF could be the tip of the iceberg.

    In your coverage of this story, I think the number of Quadriga's clients are 500 charities. What if all of these charities operate like DVNF? Maybe charity managers could work at multiple charities with huge salaries.

    Maybe Quadriga is the center of a racketeering organization like the mafia. It could be the mafia?! I know this is a worst case scenario, but part of it could be actually happening.

    On a different note, I haven't heard this mentioned in the few stories I have watched that a general standard for deciding whether to donate to a charity is 80% of the funds collected go directly to the charity's customers (e.g. the DVNF customers are the disabled veterans) or 20% of the funds collected go to the charity's overhead which includes the salaries. Try to target the charities with the lowest overhead (i.e. the highest percentage going to the customers). Maybe 90% customers / 10% overhead. Ask for the non-profit's annual report(s).

    May 23, 2012 at 9:03 pm |
  8. acajunthatsagun

    Yep, let's hear it again. We need less regulation and oversight. A vote for Mitt Romney will ensure more of this kind of thing goes unchecked.

    May 23, 2012 at 8:42 pm |
  9. Thom Dietmeier

    Yes, it is discusting that these organizations rip off the ones they are set up to “help”; it is also discusting that our Gov’t allows it to continue so long before doing something about it. (sorry about the previous typo)

    May 23, 2012 at 8:19 pm |
  10. Thom Dietmeier

    Yes, it is discussing that these organizations rip off the ones they are set up to “help”; it is also discussing that our Gov’t allows it to continue so long before doing something about it.

    May 23, 2012 at 8:09 pm |