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ATTORNEY GENERAL HERRING SHUTS DOWN DECEPTIVE HOMELESS VETERANS CHARITY

~ Settlement involves Center for American Homeless Veterans, Inc., Circle of Friends for American Veterans and Brian Arthur Hampton, will shut down the organization and $100,000 will be distributed to help homeless veterans; the charity allegedly misused more than $13 million that was supposed to go to homeless veterans ~

RICHMOND (March 5, 2020) – As part of National Consumer Protection Week, Attorney General Mark R. Herring announced today that he has shut down an allegedly deceptive organization that exploited goodwill towards those in the military and misused more than $13 million that was supposed to go towards homeless veterans. The settlement involves Center for American Homeless Veterans, Inc. and Circle of Friends for American Veterans, two Virginia-based organizations, and their founder Brian Arthur Hampton that raised funds across the country through telemarketers ostensibly to provide education and assistance for homeless veterans, but a majority of which actually went towards paying telemarketers and the salaries of the founder and staff. The settlement shuts down the organizations, permanently bars Brian Hampton from soliciting charitable contributions and holding a fiduciary position with any charitable organization, and requires the organization to distribute $100,000 to charities that provide real assistance to homeless veterans including Virginia Supportive Housing in Richmond, the Bob Woodruff Family Foundation, and Homes for our Troops.
 
Following an extensive investigation, Attorney General Herring’s Consumer Protection Section found that the organizations had violated the Virginia Solicitation of Contributions (VSOC) law by misleading donors into believing that the funds they collected would be used for veterans’ assistance programs and organizations. Additionally, the organizations made other false statements in state and federal filings.
 
“It is despicable that there are organizations out there that will deceive kind-hearted Virginians who just want to help homeless veterans in our communities,” said Attorney General Herring. “My office will vigorously go after these bad actors who take advantage of the kindness of Virginians to benefit themselves. I would encourage Virginians to remain vigilant when donating to charities and make sure you are donating to trustworthy, legitimate organizations.”
 
The Attorney General’s complaint, filed in Circuit Court in Falls Church, alleges that both organizations engaged in a number of acts and practices in violation of the VSOC law. Through telemarketers that generally retained 90% of funds raised, the enterprise allegedly led donors to believe that their donations would help homeless veterans with food and shelter or job training and support, when in reality, only tiny amounts of donated money benefitted homeless veterans. Funds that ultimately made their way to the organization primarily went to salaries for the founder and other staff, among other things not related to programming. Millions of dollars remained with the telemarketers that the organization hired.
 
Additionally, solicitation literature and other materials from the organization led donors to believe that it provided direct services to veterans, and that it gave funds to transitional facilities that get veterans off the streets and into productive lives. Attorney General Herring’s complaint alleges that the organization did not operate any transitional facilities, and provided only the smallest amount of direct funding for that purpose. Literature from the organization claimed that donated funds would help provide “our hungry and homeless war heroes food and shelter,” when that was not the case. Appallingly, the cost of the organization’s telemarketing campaigns with the problematic solicitation scripts was misleadingly characterized in the charities’ financial disclosures as program expenses to inflate those numbers and lead prospective donors to believe that the organization was providing more support to homeless veterans than it actually was. Moreover, the organization allegedly also had a host of troubling internal processes and business practices with no real board oversight.
 
The settlement includes:
  • Dissolution of the entities
  • A monetary payment in the amount of $100,000 to be provided to three charities which provide real support and assistance to homeless veterans. The three charities that will receive funding are:
  • Virginia Supportive Housing - $33,333.33
  • Bob Woodruff Family Foundation - $33,333.33
  • Homes for our Troops - $33,333.34
  • Injunctive relief in the form of a ban on the founder from engaging in charitable solicitations or holding any fiduciary position with any charitable organization
  • Suspended judgments of $10,000 for civil penalties, $10,000 for attorneys’ fees, expenses in investigating this matter, and costs, and $3,711,965.17 for the use and benefit of charities assisting homeless veterans, and as disgorgement of funds solicited nationwide over a period of time by one of CAHV’s professional solicitors, which can be enforced if the other terms of the settlement are not complied with
 
Virginia’s settlement is in the form of a Consent Judgment, which has been filed for approval with the Falls Church Circuit Court.
 
Tips to remember when donating to charities and other organizations:
  • On crowdfunding sites:
    • Check the creator or page owner's credentials and try to confirm its authenticity and seriousness
    • Look for indicators of endorsement or legitimacy that the page is actually collecting donations for a particular victim or organization. Some sites offer verification and transparency measures for campaigns. Look for those markers of authenticity, and check out the site's fraud protection measures
  • Be cautious, and if you feel uneasy, contribute to a more established charity in the community
  • Be wary of charities that spring up overnight in connection with a current event or natural disaster. They may make a compelling case for you to make a donation but even if they are legitimate, they may not have the infrastructure or experience to get your donation to the affected area or people
  • Only give to charities and fundraisers you can confirm are reliable and legitimate. Scrutinize charities with consumer advocates or friends and find out how much of your donation will go to the charity's programs and services
  • Beware of "copy-cat" names that sound like reputable charities. Some scammers use names that closely resemble those of respected, legitimate organizations
  • Be especially cautious if you do not initiate the contact with the charity
  • Do not be pressured into giving. Legitimate organizations will not expect you to contribute immediately
  • Ask for written information about the charity, including name, address, and telephone number. Legitimate organizations will give you materials about the charity's mission, how your donation will be used, and proof that your contribution is tax-deductible. Just because a "charity" has a tax identification number does not mean your contribution is tax-deductible
  • Avoid cash donations. Make checks payable to the charitable organization and not to an individual collecting a donation. For security and tax record purposes, you may wish to pay by credit card
  • If contributing over the Internet, be sure the web site you are visiting belongs to the charity to which you want to donate. See if other legitimate web sites will link to that web site. Make sure the web site is secure and offers protection of your credit card number
  • If a charity is soliciting contributions in Virginia, verify its registration with the Virginia Department of Agriculture and Consumer Services' Office of Charitable and Regulatory Programs ("OCRP") at (804) 786-1343, or by searching OCRP's Charitable Organization Database online
  • While a legitimate charity should be registered with OCRP to solicit contributions in Virginia, registration alone does not mean that the organization will be effective
 
Who to Contact
You can report charitable solicitation fraud to the Office of Charitable and Regulatory Programs (OCRP) and the Office of the Attorney General at the following addresses and telephone numbers:
 
P.O. Box 1163
Richmond, Virginia 23218
(804) 786-1343
(804) 225-2666 (fax)
 
OCRP administers the provisions of the Virginia Solicitation of Contributions ("VSOC") law, Virginia Code §§ 57-48 through 57-69, and registers charitable organizations soliciting in Virginia. OCRP investigates complaints where there is an alleged violation of the VSOC law by a charitable organization or its professional fundraiser while soliciting contributions in Virginia. If it has reason to believe violations have occurred, OCRP can make an investigative referral to the Attorney General's Office and/or other agencies for a possible law enforcement action.
 
  
OFFICE OF THE ATTORNEY GENERAL
Consumer Protection Section
202 North Ninth Street
Richmond, Virginia 23219
(800) 552-9963 (if calling from Virginia)
(804) 786-2042 (phone) (if calling from Richmond area)
(804) 225-4378 (fax)
 
The Virginia Attorney General has authority under state and federal consumer protection statutes to investigate and prosecute charitable solicitation and other consumer fraud and misrepresentation. If an action is brought, the Attorney General can seek injunctive relief to halt fraudulent or deceptive conduct in Virginia and obtain restitution for injured consumers. 
 
Office of the Attorney General’s Consumer Complaint Form

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