(CN)
- The National Veterans Services Fund pays most of the millions it
collects to for-profit solicitors and its president, while giving less
than 10 percent directly to veterans, a class claims in Federal Court.California plaintiff David Urzua sued National Veterans Services Fund of Darien, Conn., in the U.S. District Court for the Southern District of California, alleging false advertising and unfair competition.
Claims on the Connecticut-based fund's website about using charitable gifts to help "our nation's heroes and their families" led Urzua to donate recently, "expecting that his contribution would directly aid veterans in need," according to the complaint.
The fund's website contains numerous testimonials from alleged aid recipients.
Urzua claims, however, that only a fraction of the donations that the fund receives ever make it to veterans and their families.
Citing a collaborative report from the Tampa Bay Times, the Center for Investigative Reporting and CNN, Urzua said "an average of only 7.8% of the approximately $70 million raised by defendant NVSF in the last ten years actually made it to veterans in direct cash." (Emphasis in original.)
That report named NVSF "America's eighth worst charity," the complaint states.
Urzua said corporate fundraisers and executive salaries collect for the bulk of the money that the fund raises, with only $500,000 a year going to veterans and their families.
Since NVSF president and treasurer Phillip Kraft brought home $118,800 from NVSF in 2011, it can be said that his salary "exceeds one-fifth of the amount that goes to veterans in direct aid per year," according to the complaint.
NVSF meanwhile "fails to disclose these facts to veterans," Urzua added.
"In fact, there are no details of the above listed grants reported in any of the charity's annual IRS filings, which only refer to spending on 'veterans assistance and relief.'"
The tax-exempt charity says it was founded in 1978 and previously known as Vietnam Veterans Agent Orange Victims Inc. Its website names the charity's target population as "Vietnam- and Persian Gulf War-veterans and their families, with a focus on families with disabled children."
It was precisely this "rhetoric" that motivated Urzua to donate, according to the complaint.
"Defendant NVSF claims to give direct aid by providing a range of support including purchasing wheelchairs, scooters, ramps; paying utility bills; providing gift cards; buying snow tires and dentures; and providing temporary housing," Urzua notes.
The website even claims that its charity has covered veterinarian bills for a veteran's service animal.
Urzua claims that NVSF's professional fundraisers take the lion's share. Those solicitors are identified in the profile on America's Worst Charities as Bonded Couriers, Bee LC, Courtesy Call, Vehicle Donation Processing Center and Direct Response Consulting Services. None is a party to the complaint.
"Over the past ten years, Defendant NVSF has paid approximately $36.9 million in cash to solicitors and for-profit fundraisers," the complaint states. "What is worse, the percent going to professional solicitors has increased over time and, in 2011, the charity raised about $9 million, of which 82 percent went to professional solicitors."
The Worst Charities feature says NVSF was disciplined or suspended in Colorado and Ohio.
Kraft declined to comment on the lawsuit, noting that NVSF has turned the case over to its lawyers "because the claims are BS."
Urzua is represented by Scott Ferrell of Newport Trial Group. Ferrel was unavailable for comment on exactly how much or when his clien donated to NVSF.
