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Veteran Charities – Not All Exist to Benefit Veterans

Nov 24 | 2014  by

There are around 1.6 million non-profit organizations in this country. Of those, upwards of 65,000 include the word “veterans” in their title. With so many seeking donations, it is more important than ever to be confident that when you give veteran charities your donation, it will actually be used to help veterans.

Many people believe that the IRS granting 501(c)(3) status ensures an organization’s legitimacy. However, the truth is that there is minimal oversight of the process of creating a non-profit organization. In fact, the IRS recently simplified the application for 501(c)(3) tax exemption from 12 pages (plus schedules) down to only 3 pages.

With almost no ongoing oversight, many of these groups use only a very small portion of donation money to fund products and services for veterans. Even worse, some individuals use fraudulent organizations solely to enrich themselves.

Fraudulent Veteran Charities

For example, the United States Navy Veterans Association (USNVA) was a registered 501(c)(3) charity. It had many markings of a legitimate non-profit – a quality website, supposedly in operation since 1927, and dozens of purported chapters across the country with thousands of members nationwide. In reality, USNVA was run by one man out of his duplex in Florida. This sham charity bilked donors out of nearly $100 million over a seven-year period. In 2012, authorities arrested and sentenced the ringleader to 28 years in prison and $6 million in fines, but unfortunately, recovering most of these donations is unlikely.

Fortunately, there are resources available to assist potential donors in verifying the legitimacy of a charity before donating. First, most legitimate charities post their financial statements/annual reports on their website so the public may view them. Additionally, Guide Star is a non-profit that provides detailed information about 501(c)(3) registered charities. Further, legitimate charities should be completely transparent. If an organization is not forthcoming about providing financial/audit statements, copies of its conflict of interest policy, or information about the board of directors and employees, there is cause for concern.

Fausone & Grysko, PLC

Contact Fausone & Grysko, PLC if you doubt the authenticity of a veteran charity or have been defrauded by one. We can provide you with the sound legal advice that you need. You can reach us at  (248) 380-0000 or online at www.FB-Firm.com.