Restitution has been disbursed to two veteran charities to assist veterans in need
SACRAMENTO – California Attorney General Xavier Becerra and the Federal Trade Commission led a coalition of five Attorneys General in securing a $1.8 million settlement against a deceptive veteran charity, Help the Vets, Inc., and its founder, Neil G. Paulson. During a four-year period, Help the Vets used multiple fictitious names and solicited $20 million in donations nationwide by misleading donors about its cause. The sham charity claimed to help veterans receive grants, medical assistance, suicide prevention assistance, and family retreats when, in fact, little to none of the funds raised went toward this assistance.
“Defrauding generous Americans by lying about providing services to our courageous veterans is outrageous and an insult to our service members,” said Attorney General Becerra. “Californians deserve to trust that their charitable donations are going toward legitimate organizations that have actual charitable programs. My office is committed to bringing to justice all dishonest charitable organizations who claim to help our veterans only to line their own pockets.”
On July 18, 2018, Attorney General Becerra, along with the Federal Trade Commission and five other state Attorneys General, filed a complaint and settlement in federal court against Help the Vets. On November 21, 2018, the court approved the settlement and Help the Vets and Mr. Paulson were ordered to pay over $1.8 million dollars. Further, to ensure the money is used for the purposes Help the Vets claimed, the Attorneys General and other states received court approval to distribute $911,906.37 each to two veteran charities, the Injured Marine Semper Fi Fund and Hope for the Warriors.
The complaint also charged that Help the Vets improperly inflated how much it spent on some of its illusory programs, such as the family retreat program. In IRS filings, Help the Vets reported it spent more than $12 million dollars on this program by distributing time share vouchers based on their supposed fair market value, even though it paid nothing for the vouchers and virtually no veterans used them. The filing of the complaint also followed a cease and desist order issued by Attorney General Becerra that prohibited Help the Vets from operating and soliciting in California and assessed penalties. The cease and desist order found that Help the Vets misrepresented its fundraising and program service expenses in its annual reports filed with the Attorney General’s Registry of Charitable Trusts and also failed to disclose a self-dealing transaction with Mr. Paulson, among other law violations. Help the Vets and Mr. Paulson are also banned from soliciting charitable contributions, and Mr. Paulson is banned from engaging in other activities involving charitable organizations.
Attorney General Becerra and the Federal Trade Commission led the Attorneys General of Florida, Maryland, Minnesota, Ohio, and Oregon in securing the settlement, which can be found here.
To file a complaint about a charity or fundraiser with the California Attorney General's Office, visit https://oag.ca.gov/charities and click on the complaint form.