I-Team probe prompts state investigation into veterans charity

I-Team probe prompts state investigation into veterans charity

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by MICHELLE BOUDIN / NBC Charlotte

Bio | Email | Follow: @MichelleBoudin

WCNC.com

Posted on November 7, 2013 at 12:38 AM

Updated Thursday, Nov 7 at 12:40 AM

CHARLOTTE, N.C. -- It's that time of year when most of us feel a little bit more charitable.
But do you always know where your money is going?

Several viewers asked NBC Charlotte to look into a group that claims to help veterans here. But that group's been told to stop in other states, so why are they doing business in Charlotte?

You've probably seen them around town. In recent months our cameras have spotted them at the airport, at Charlotte Motor Speedway, and just this past weekend outside the Panthers/ Falcons game.

They carry an American flag and a bucket and ask for donations.

They're called the VSO, or Veterans Support Organization.

NBC Charlotte started looking into VSO in May after a representative from an area mall where they were soliciting called us with concerns.

Brandy Trevino gets paid minimum wage to ask travelers at Charlotte Douglas for money.

She stated, “We’re a 501(c) (3) non-profit organization collecting money for our work program, our housing program and our grant and gift card program. Seventy-percent goes back to the organization-- which is more than any other in the area, other than the Salvation Army in this area.”

Actually, according to the Better Business Bureau almost all charities in good standing give at least 70-percent to the cause. As for that 70-percent answer, we'll get back to that; we heard it over and over as we looked into the VSO.

We checked the group’s financials; they filed them with the State of North Carolina when requesting a license to operate here.

Of the $7.2 million collected last year, only $47,000 went to grants. Another half a million went to pay the CEO's salary, which is more than $250,000, and "other salaries and wages.

But that leaves almost $7 million.

Richard Van Houten is the group’s founder and CEO. He admits that VSO has faced a lot of scrutiny.

“We encourage it. I encourage every state to look into us, because all we want to do is operate by the book,” he said.

Several states have. NBC Charlotte talked to officials from six states: The VSO has been kicked out of South Carolina, investigated in Georgia and Florida, and in Connecticut, seven members of congress wrote to the feds, calling for a federal investigation. Lastly, the VSO faced $20,000 in fines in Tennessee.

Van Houten blames all the past troubles on semantics, saying he improperly labeled the people soliciting money as contractors when they are actually paid workers. 

“When I first started the group, we paid them as independent contractors, and through the years, every business makes small mistakes; I mean it was a mistake, we had corrected it, now they're all paid as employees,” Van Houten states.

In other words, one of the ways veterans are helped is by putting them to work asking for the donations for veterans.

Van Houten explains, “What VSO does is they hire locally-- the struggling veterans and Americans that need jobs.”

Still, it's not clear how much of the $7.2 million raised goes to paying the people asking for money.

“Our cost of employees did go up. We have an accountant who handles all of that-- the budgeting, and of course paying them.” Van Houten said.

NBC Charlotte asked, “So how much of the budget now goes to that?”

Van Houten replied, “I'm not really sure offhand. I can tell you what we've raised, and right now, out of every dollar, a little over 71-percent goes to the cause.”

“So the remaining money, about 5 million is going to the housing?” NBC Charlotte asked.

Van Houten said, “No, no, no. We have housing, work program and then gifts.”

NBC Charlotte asked again how much money goes to housing, and Van Houten replied, “I wouldn't… I can get you the breakdown, but I know of the $5.6 million that we raise, over 71-percent goes to the cause.”

Van Houten admits, not everyone collecting money is a veteran.

Brandy Trevino said, “I'm a non-veteran, but I was raised in an Air Force family.”

Another gentleman collecting for the VSO outside Speed Street in uptown told NBC Charlotte, “We’re collecting for our local veterans, help them find jobs and all of that, help them find a place to live.”

When asked if he was a veteran, the man simply replied, “No.”

There are no housing programs in Charlotte.

Van Houten says there are 100 veterans being housed-- in Florida.

Only one of which is from Charlotte; he was given a bus ticket to get to the Florida facility.

Anne Munns is a veteran who often donates to veteran charities but held back when Brandy hit her up at the airport.

“Did you question at all where the money was going?” NBC Charlotte asked her.

“No, but I wondered after she walked away,” Munns admitted.

Still, one of the actual veterans who has been working with the VSO in Charlotte since September says he's proof the VSO is helping veterans.

Paul Zimmerman said, “It changed my life, helps me out financially.”

But as soon as NBC Charlotte started asking him where the money goes, he said, “Any questions about how the process runs-- we don't know. I just go out to storefronts, do my job.”
 
Van Houten told NBC Charlotte during our interview that since filing with the state of North Carolina, he has cut his salary in half.

Late last week, the Secretary of State’s Office told NBC Charlotte that after we started asking questions, they did, too; they have launched an investigation-- including sending a stack of subpoenas to the VSO.

We'll let you know what happens.

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