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Posted at 12:57 PM ET, 02/22/2011

Veterans charities will again have to register after U.S. Navy Vets fiasco

By Rosalind S. Helderman
Rosalind S. Helderman

The Virginia General Assembly has agreed to repeal an exemption for veterans charities from state registration requirements enacted last year after discovering that the organization that had pushed for the exemption is under investigation for running a scam operation.

The organization was run by a man who had contributed heavily to political candidates around the country, including more than $55,000 to the campaign of Virginia Attorney General Ken Cuccinelli (R). Ohio authorities have said the man was using a stolen identity and have issued a warrant for his arrest. He is at large.

The House of Delegates unanimously agreed Tuesday to reinstate requirements that veterans charities annually register with the state. The state Senate agreed to the measure and it now heads for approval to Gov. Bob McDonnell (R), who has supported it.

The bill's passage comes as the Virginia Department of Agriculture and Consumer Services, which regulates state charities, confirms that it has concluded an eight-month investigation into the activities of the U.S. Navy Veterans Association and turned its reports over to the Virginia Attorney General's office for possible criminal prosecution. The investigation's conclusion was first reported Tuesday by the Roanoke Times.

Secretary of Agriculture and Forestry Todd Haymore said in an interview that investigators found that the organizations may have solicited at least $2 million over a five-year period from Virginia residents who believed they were giving money to help veterans. He said the agency concluded that there is a "strong likelihood that the organization was acting fraudulently."

According to Haymore, two of the three investigators in the office of consumer affairs investigations unit were devoted to examining the group's activities, including one who has worked on the case full time since July.

"This was a major, major focus," he said.

The agency worked closely with a half a dozen other states also examining the group and responded to calls from residents who believed they might have been scammed by the organization, he said.

"To think that this group was potentially using navy veterans--the good name of navy veterans--to act in a fraudulent manner, it's just abhorrent," Haymore said.

A spokesman for Cuccinelli said most violations of charitable solicitation laws are pursued by local commonwealth attorney's. He said Cuccinelli and his staff would review the case to determine appropriate action.

"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. "This office will work with our law enforcement partners at the state, local and federal levels to find 'Bobby Thompson' and any other cohorts, to ensure those responsible are held to account for what they have done."

The General Assembly last year passed a bill exempting veterans groups from annual registration requirements after a lobbyist for the organization came to state Sen. Patsy Ticer (D-Alexandria) and asked her to carry the legislation.

She later said she believed the group was legitimate and the bill innocuous. After its passage, however, she read a lengthy investigation of the Florida-based group in the St. Petersburg Times. The newspaper revealed that the group's officers appeared to be fake and the group appeared to be soliciting millions and spending very little on veterans.

The group's founder, a man who went by the name Bobby Thompson, had contributed to political candidates around the country. Virginia recipients, who included Ticer and McDonnell, agreed to donate his money to legitimate charities. After first resisting, Cuccinelli too agreed to donate Thompson's contributions in July, after he was charged in Ohio with identity fraud.

Haymore said consumer affairs investigators received no cooperation from the group's principles. He said too that the agency concluded that no elected official in Virginia committed wrongdoing in pushing the legislation on the group's behalf last year.

Haymore said he worked with Ticer on this year's bill to repeal the exemption. In the meantime, the agency discovered legitimate veterans charities already receive exemptions from some reporting requirements and he does not believe any group will be affected by repealing last year's measure.

By Rosalind S. Helderman  | February 22, 2011; 12:57 PM ET
Categories:  General Assembly 2011, House of Delegates, Ken Cuccinelli, Rosalind Helderman, State Senate  
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