The state of Tennessee is moving forward with its own investigation of a group raising money that it says will help veterans. The state wants answers to questions first raised by NC5 Investigates.more>>
NASHVILLE, Tenn. - State regulators are taking a hard look at a new charity in town. It's a group that claims it's out to help needy veterans.
That comes after NewsChannel 5 Investigates went undercover to find out what's really happening with the money that's given to the group. Our investigation discovered that yourdonations may not be going where you think they are.
State charity regulators told NewsChannel 5 Investigates that not only were they not aware that the group had set up shop here in Tennessee, but those regulators have some tough questions for the group about what we caught on tape.
When people are asked to help the men and women who have served our country, folks naturally want to give what they can.
A group calling itself the Veterans Support Organization is out collecting money in front of stores in the area.
The men who collect the money wear camouflage and combat books and tell people going in and out of the stores, "Twenty bucks will help get a homeless or needy veteran off the street."
Hank Edney is in charge of the VSO's new Tennessee office and he said, "All of the funding raised here will stay in Tennessee."
Edney explained that the money they collect goes to other organizations that provide direct help to veterans.
We found what Edney said was a lot different from what we heard from the men collecting the money when we went undercover.
One of the men in fatigues said, "We can help get a homeless or needy veteran off the street and into our shelter. Our shelter will just be for veterans who are homeless. They're getting ready to open [it] in Madison in about three weeks."
So NewsChannel 5 Investigates asked Edney, "Tell me about your plans to open a shelter here."
"Well, there are no plans at this time to open a shelter," said Edney.
We told him, "They told us you were opening a shelter in Madison."
"I'd really like to see that because there's been no mention of doing anything like that," replied Edney.
Another fundraiser said, "We're working with a couple of country stars. We just shot a video with one."
The video shot by singer Stephen Cochran was done for the VA, not the VSO.
"The VSO had nothing to do with this video, right?" NewsChannel 5 Investigates asked.
"No," answered Edney.
The Veterans Support Organization's own Web site said the money collectors are not paid, that they're volunteering their time.
One of the fundraisers told us the same thing.
"Yes, I volunteer," said the fundraisers.
"So you're not getting paid for being out here?" we asked.
He replied, "No."
NewsChannel 5 Investigates then asked Edney, "Are all of the people out collecting money being compensated?"
"Yes, they are," admitted Edney.
He went on to explain that the people get to keep 30 cents from every $1 they collect, while Edney gets another 10 percent of the money.
"So what percentage of each dollar will go to these charities?" we asked.
"At least 65 percent," answered Edney.
According to the group's own financial statements, the VSO collected more than $2.5 million last year across the country, yet it only gave just over $400,000 of that to programs that help veterans. That's just 16 cents out of every dollar.
"I don't know if you'd say it's a small amount. It's the amount beyond expenses," said Edney.
Click Here to see the Veteran Support Organization's 2009 audited financial statement.
Since moving into Tennessee last month, the VSO has given $1,500 to the VA and $3,000 this week to the Fisher House Foundation, which is trying to build a place for veterans' families to stay while they're being treated at the VA.
One of the fundraisers told our undercover crew, "It's a $2 million project. We're still working on it. It's going to happen. We're going to help fund that."
The VSO worker specifically mentioned the Fisher House when we asked where our donation would be going even though Hank Edney said the Fisher House Foundation specifically asked them not to.
"They told you not to tell folks that you were soliciting money for the Fisher House?" we asked.
"Right," replied Edney.
Bob Ousley is the state director for the veterans group Rolling Thunder. He said of the VSO, "They're salesmen."
Ousley is just one of several local leaders of veterans groups who believe the VSO is misleading the public.
"You're dressed in fatigues and you're representing veterans, but you're not a veteran," said Ralph Land, president of the local Vietnam Veterans of America chapter.
Some of the men collecting money for the VSO are veterans, some we found are not, including the man in charge.
Yet, one fundraiser told our undercover crew, "Hank, [he's] a very nice guy. He was in the Army."
Edney, who is not a veteran, was surprised to hear this.
"Wow, I don't know why he would say I was in the Army," said Edney.
Click Here to read "Veterans Support Organization Not a Scam," a statement issued by the Veteran Support Organization about its employees' claims.
"They say what they need to go get the dollars out of these people and put it in their car because that's their commission," said Ousley.
The VSO asked several of the veterans groups in town to partner with them.
The groups said they turned the VSO down saying they were concerned about the VSO's tactics and that so little of the money is actually going to charity.
Meanwhile, the head of the state Division of Charitable Solicitations said he's going to be asking some of the same questions that we did. It's not clear what actions, if any, his office might take. NewsChannel 5 Investigates will let you know what happens.