AGs Get $1.8 Million Settlement, Charity Leader Banned

Complaints filed by the Federal Trade Commission (FTC) and state charity regulators in six states – California, Florida, Maryland, Minnesota, Ohio and Oregon – have yielded a $1.8 million settlement against a sham veteran charity.

Regulators filed a 78-page complaint last summer in U.S. District Court for the Middle District of Florida, Orlando Division against Help the Vets, Inc. (HTV), in conjunction with “Operation Donate With Honor,” aimed at cracking down on dubious veteran charities.

    Orlando, Fla.-based HTV raised $20 million over three years, operating under difference names, including:

  • American Disabled Veterans Foundation;
  • Military Families of America;
  • Veterans Emergency Blood Bank; and,
  • Veterans Fighting Breast Cancer.

Neil G. “Paul” Paulson, Sr., was the only employee and president of HTV until 2016. He unsuccessfully challenged incumbent Orlando Mayor Buddy Dyer in 2015 and briefly ran for state Agriculture Commissioner in 2017.

California Attorney General Xavier Becerra announced the settlement on Friday. Earlier in the week, Becerra announced a lawsuit against Aid for Starving Children, a Santa Rosa, Calif.-based charity that he alleged overvalued Gifts In Kind (GIK) donations.

The court approved a permanent injunction in November, securing a $20.4 million judgment. HTV and Paulson were ordered to pay more than $1.8 million. In addition, the court approved distribution of $911,906.37 each to two legitimate veteran charities: the Injured Marine Semper Fi Fund in Quantico, Va., and Hope for the Warriors in Springfield, Va.

State charity regulators alleged that HTV “misled donors about the good their charitable donations would accomplish, and prevent millions of dollars from going to legitimate charities that do help wounded and disabled veterans.” Under the settlement, Paulson and HTV will be banned from soliciting charitable contributions and also bans Paulson from charity management and oversight of charitable assets.

The complaint charged that Help the Vets improperly inflated how much it spent on programs. The charity reported spending $12 million on a family retreat program that distributed time-share vouchers based on their supposed fair market value, even though HTV paid nothing for the vouchers and virtually no veterans used them.