AG joined officials from all 49 other states to combat fraudulent charities that falsely claim to help veterans and servicemembers
LANSING – Michigan Attorney General Bill Schuette today announced his Charitable Trust Section’s participation in a sweeping new donor education campaign “Operation Donate with Honor.” The campaign includes law enforcement officials from all 50 states, the District of Columbia, American Samoa, Guam, Puerto Rico, and the Federal Trade Commission (FTC). The campaign serves as an opportunity both to educate residents about fraudulent veterans charities and related scams and to announce new and recent law enforcement actions by the states and the FTC against fraudulent veterans charities.
In recent years, Schuette’s Charitable Trust Section has been a leader in fighting deceptive charitable solicitations and, in particular, fighting deceptive veterans charities. As part of Operation Donate with Honor, participating agencies announced 100 recent enforcement actions against deceptive veterans charities, including five actions in Michigan. (Michigan’s actions are detailed below.)
“I am proud of the work my Charitable Trust Section has done to protect Michigan consumers, as well as veterans and active duty military from fraudulent charities,” said Schuette. “Most charities operate in good faith and fulfill the promises they make, but unfortunately a few lie about their activities and profit by exploiting the sympathy of donors for veterans causes. This nationwide action serves as a reminder to residents to research before donating; it’s also a reminder to the scammers that charity regulators across the country are working to expose them.”
Below are Michigan’s five enforcement actions against deceptive veterans charities:
- Michigan’s March 2017 action against Illinois-based VietNow alleged thousands of deceptive solicitations that misrepresented VietNow’s charitable programs, programs that were minimal to non-existent. Michigan’s action led to other state investigations and actions against VietNow and, ultimately, a 24-state settlement resulting in penalties, restitution, and VietNow’s dissolution.
- Michigan’s 2017 allegations of filing inaccurate financial statements against Florida-based Help the Vets resulted in a 5-year solicitations ban in Michigan and brought Help the Vets to the attention of other charity regulators. Recently, the FTC and 6 other states filed a complaint and settlement in federal court, resulting in Help the Vets’ dissolution and other penalties against its founder Neil Paulson. In 2017, Michigan also acted against another of Paulson’s deceptive charities, Breast Cancer Outreach Foundation.
- Michigan’s 2017 action against Texas-based Healing American Heroes and its professional fundraiser Jeremy Squires and Associates resulted in a settlement including penalties, restitution, and the dissolution of Healing American Heroes. Healing American Heroes, which also used the name Help Our Wounded, promised to send phone cards to deployed servicemembers, but used almost all funds raised for other purposes. (As part of Operation Donate with Honor, the Better Business Bureau’s Wise Giving Alliance featured this enforcement action in a video interview here.)
- In September 2017, Schuette alleged deceptive solicitation violations against Florida-based American Veterans Foundation. In February 2018, Schuette sued. The action remains pending.
- In 2016, Schuette began investigating Michigan-based Foundation for American Veterans. In response to that investigation, Foundation for American Veterans elected to voluntarily dissolve. The investigation remains pending.
The law enforcement actions announced today by the FTC and states showcase the many ways that consumers are approached to donate: online, telemarketing, direct mail, door-to-door, and at retail stores. Common to all enforcement actions was a false promise to help veterans, including false promises to give financial and other assistance to homeless and disabled veterans; to counsel veterans; to assist local veterans; and to send phone cards and care packages to deployed service members. Many of the schemes operated nationwide and employed fundraisers that took 85% or more of each donation.
“Operation Donate with Honor” Education Campaign
Operation Donate with Honor was planned by the FTC and the National Association of State Charity Officials (NASCO), the association of state charity officials charged with overseeing charitable organizations and charitable solicitations in the United States. The initiative pairs enforcement actions with an education campaign, in English and Spanish, to help consumers recognize charitable solicitation fraud and identify legitimate charities. This includes a new video that highlights tips on how to research charities on giving wisely to veterans organizations. The Better Business Bureau’s Wise Giving Alliance also cooperated by producing three videos of assistant attorneys general explaining some of the enforcement actions they took, including this video of Michigan Assistant Attorney General Will Bloomfield discussing Michigan’s action against Healing American Heroes. The national education campaign is intended to help potential donors, regardless of where or how they choose to donate, learn to spot fraudulent and deceptive solicitations so their contributions will truly benefit veterans and service members.
Schuette encourages potential donors, regardless of where or how they choose to donate, to learn to spot fraudulent and deceptive solicitations so their contributions truly benefit veterans and service members.
When donating to charity, remember the following:
- Don’t be pressured into donating before you’ve researched the charity;
- Don’t rely on a sympathetic sounding name (see infographic below);
- Search the charity’s name online with the word “scam” or “complaint,” and see what other people say about it;
- If contacted by telephone, ask how much of any donation will go to the charitable program you want to support;
- Check whether a charity has registered with the Attorney General’s Charitable Trust Section;
- Check the charity’s ratings at the BBB Wise Giving Alliance, Charity Watch, or Charity Navigator;
- Never pay with cash, a gift card, or by wiring money;
- Consider paying by credit card, which is the safest option for security and tax purposes.
Another resource is the annual Giving Wisely brochure. The brochure is published by the Department of Attorney General in partnership with The Michigan Nonprofit Association, Council of Michigan Foundations and Michigan Association of United Ways. Donors and business owners can also find information to help them donate wisely and make their donations count at FTC.gov/Charity.