The logo of The Center for American Homeless Veterans, displayed here, proclaims, “Put Veterans First.” But after reviewing its financial filings, I’d say the more accurate motto would be “Put Paid Fundraisers First.” I mean, what other conclusion is possible about an organization that handed the overwhelming bulk of money raised from the public in the name of a good cause to paid telemarketers?
Operating under the trade name Association for Homeless and Disabled Veterans, fundraisers for CAHV have been cold-calling around. One such cold call came recently to the New To Seattle world headquarters.
The caller, a computer-generated voice recognition program using a name that sounded to me like Eric Thornton, urged me to contribute to CAHV’s mission of advocating for, well, homeless and disabled veterans. Unfortunately, Thornton had static–the electronic equivalent of a cough, I guess–making him/it quite hard to understand. Still, I kept asking questions, and understood him/it to say his/its nonprofit was headquartered in the Washington, D.C., suburb of Falls Church, Va.
As is so often the case when an interactive computer calls asking for money, one of my simple questions eventually proved a stumper. And when it did, Thornton pleaded, “I’m in training right now.”
How can that be, I asked. “You’re a computer!” I shouted. Programmed to have answers!
Thornton denied that–sort of, saying that a human was monitoring the conversation. As you might imagine, the call quickly came to an end.
Then I got on my computer.
From this page I downloaded CAHV’s tax return and audited financial statement for the year ended September 30, 2013. In round numbers, here’s what they show:
CAHV raised $2.1 million from the public. It promptly gave $1.8 million of that to paid telemarketer Outreach Calling, of Reno, Nev. Of the remaining $300,000, $200,000 was spent in support of the stated mission (advocacy and education about the problem of homeless veterans), and $100,000 for management and certain overhead expenses.
Now, a little math. CAHV’s charitable commitment ratio–the percent of total expenses spent in direct furtherance of the stated mission–was $200,000 divided by $2.1 million, which rounded to 10% (this is the same number found on the website of the Washington State Secretary of State’s office). The fundraising efficiency ratio–the percent of the amount raised after subtracting the costs of raising it–was $2.1 million minus $1.8 million, or $300,000, divided by $2.1 million. This rounded to 14%, although if the full numbers were used without rounding, it was less than 12%.
For either ratio, charity watchdogs like the BBB Wise Giving Alliance say anything below 65% is unacceptable. The Wise Giving Alliance, by the way, also says in a current report that CAHV refused to cooperate in an evaluation and also has an unaddressed customer complaint, neither of which is a sign that the organization is on the up-and-up.
As it turns out, CAHV has a close relationship with a contributions-are-tax-deductible organization called Circle of Friends for American Veterans. Judging from its filings for the same time period, Circle of Friends had the same president, staff, office address, phone number and auditor, similar mission and some shared financial transactions. Also, roughly the same dismal financial efficiencies, with $1.5 million of $1.8 million in contributions taken by paid fundraisers, and an even-more-dreadful charitable commitment ratio of 8%. Circle of Friends is also registered to raise money in Washington State, although I don’t know if it has, or under what name.
The president of both organizations is Brian A. Hampton, described on a website as an ex-Army major who served in Vietnam. I sent a message to him through the CAHV website asking for comment, and will update this post if I hear anything back. Depending on how the tax filings are read, the two organizations paid him as much as $181,668, or more than 35% of what was left over after the telemarketers took their hefty bite. Now that’s putting one veteran first.