Virginia suspects fraud by charity purporting to benefit Navy veterans
Wednesday, February 23, 2011
RICHMOND - The Virginia state agency that regulates charities has closed a nine-month investigation into the activities of a Florida-based veterans charity, concluding that the _blankU.S. Navy Veterans Association probably solicited more than $2 million from state residents under false pretenses.
The state's Department of Agriculture and Consumer Services has turned the case over to Virginia Attorney General Ken Cuccinelli II (R) for possible criminal prosecution.
The group was run by a man who contributed heavily to political candidates across the country, including donations totaling $55,000 to Cuccinelli's 2009 campaign.
In October, the man was indicted in Ohio on money laundering and theft charges. Ohio authorities accused him of using a stolen identity and issued a warrant for his arrest. He currently is at large, under investigation in more than a dozen states for allegedly running a scam operation.
A spokesman for Cuccinelli said violations of charitable-solicitation laws generally are pursued by local commonwealth's attorney offices. The spokesman said Cuccinelli and his staff would review the case to determine how to proceed.
"I am incensed that this organization defrauded people in the name of veterans, and that this fraud diverted needed money from veterans charities," Cuccinelli said in a statement, promising to work with law enforcement to help find the man, who went by the name Bobby Thompson.
The Virginia investigation was opened after the General Assembly agreed last year to exempt veterans groups from state charity-registration requirements at the urging of a lobbyist for the Florida group.
The sponsor of the legislation, state Sen. Patricia S. Ticer (D-Alexandria), later said she believed that the group was legitimate and the bill innocuous.
After its passage, however, she read the results of a six-month investigation of the Florida-based group by the St. Petersburg Times. She urged Gov. Robert F. McDonnell (R) to veto her bill, but her warning came too late, and it was signed into law.
The newspaper found that most of the group's directors and officers could not be located, despite extensive public records searches, and that the organization appeared to be collecting millions but spending little on veterans.
According to Virginia Secretary of Agriculture and Forestry Todd Haymore, the state's _blankOffice of Consumer Affairs worked closely with six of the other states examining the group and responded to calls from residents who believed they might have been scammed.
He said two of the three investigators in the Office of Consumer Affairs's investigations unit were devoted to examining the group's activities, including one who has worked on the case fulltime since July. They concluded that the group collected millions from Virginians in a five-year period that ended last year.