More good coverage on law-enforcement charity scams

At the Austin Statesman, Tony Plohetski has a story on law-enforcement themed charities including the Texas Highway Patrol Association that claim to raise money for officer death benefits then spend the overwhelming majority of funds on telemarketing and feathering their nests. Particularly interesting is his account of mostly unsuccessful legislative efforts in the '90s to rein in the practice.

See related Grits posts:

• Texas AG sues highway patrol charity scam
• Sleazy charity scams should be shut down by the IRS or regulated by Texas Lege
• Millions in fundraising for so-called charity pays paltry death benefits to dead troopers' families
• Of buzzards, road kill, charity scams and the Texas Highway Patrol Association
• Houston police union rolling in cash, but six-figure thefts went unnoticed for years
• Sleazy telemarketers capitalize on public sympathy for fallen police

Texas AG sues highway patrol charity scam

The Texas Attorney General has (finally) filed suit against the Texas Highway Patrol Museum and its related entities, which Grits readers will recall operate a telemarketing scheme picking the bones of dead state troopers by raising millions via telemarketing while giving less than a penny on the dollar to the supposed beneficiaries. Reports the SA Express-News ("State sues Texas Highway Patrol Museum in SA," Dec. 20):

Attorney General Greg Abbott has sued organizations tied to the Texas Highway Patrol Museum in San Antonio and accused them of illegally soliciting donations from the public and wasting money on trips, liquor and “exorbitant” pet care for a cat.

Contrary to its official-sounding name, the highway patrol museum at South Alamo and St. Mary's streets is not affiliated with the Texas Department of Public Safety. It is actually a telemarketing organization that raises millions of dollars in the name of helping DPS troopers.

But Abbott's lawsuit, filed in Travis County last week, alleged that few benefits were actually paid to troopers. Instead, funds were spent for personal use. One corporate credit card was used to buy cigars, liquor, and meals, the lawsuit alleges. The expenses were not reimbursed.

The lawsuit says museum funds were spent on “exorbitant vet bills” for an “office cat” that was kept at an Austin office. Tim Tierney, executive vice president of the organizations tied to the museum, said the expenses were justified because the cat kept employees happy, according to the lawsuit.

The museum's assets have been frozen and a temporary receiver has been appointed to oversee it.

Good! It's way past time. They should take a similarly close look at the two dozen or so other entities in Texas doing the same thing - most of them are scams, too.

MORE: From the Austin Statesman. See the AG's lawsuit (pdf) and past Grits coverage:

• Sleazy charity scams should be shut down by the IRS or regulated by Texas Lege
• Millions in fundraising for so-called charity pays paltry death benefits to dead troopers' families
• Of buzzards, road kill, charity scams and the Texas Highway Patrol Association
• Houston police union rolling in cash, but six-figure thefts went unnoticed for years
• Sleazy telemarketers capitalize on public sympathy for fallen police

Sleazy charity scams should be shut down by IRS or regulated by Texas Lege

The SA Express-News' full story is now online about the Texas Highway Patrol Association - a so-called charity that rakes in millions in donations but gives just a small fraction for the purpose it claims, which is raising money for the families of dead state troopers. The story opens:

From the outside, the Texas Highway Patrol Museum doesn’t look like a multimillion-dollar telemarketing operation.

Based near downtown in a single-story brick building at South Alamo and St. Mary’s streets, the small museum offers exhibits that honor Texas Department of Public Safety troopers.

But it draws few visitors, and people who work nearby have wondered how it stays in business.

“I have yet to see one person inside that place,” said Scott Cates, a waiter and lounge singer at La Focaccia Italian Grill next door. “Matter of fact, I was wondering why it’s even there. What’s the point?”

Records show the museum actually is a telemarketing operation that employs hundreds of workers across the state who generated nearly $12 million in revenue from 2004 to 2009.

The museum is one of 25 organizations registered in Texas that raise funds in the name of supporting law enforcement. Helping police officers and their families is the kind of cause that makes donors open their pocketbooks — especially when an officer dies in the line of duty.

But state officials warn that many organizations, including the highway patrol museum in San Antonio, spend most of the donations on fundraising costs and overhead. The museum collects donations in the name of honoring and helping DPS troopers — even as DPS, the state agency that employs those troopers, warns donors to avoid giving the museum money.

Reported Express-News writer John Tedesco, "for every dollar that was donated to the museum, less then a penny was actually spent on troopers and their families." By contrast, those running the "charity" are doing quite well for themselves: "In 2009, the museum and a related company that publishes Texas Highway Patrol Magazine spent $400,000 on salaries for two executives: Villalva and Tim Tierney. In previous years, the museum has listed assets that included a Land Rover, a Lexus and a Mercedes."

Another damning tidbit: "A museum brochure describes how it partnered with the local chapter of Mothers Against Drunk Driving to produce an “award winning program” for students. The MADD chapter in San Antonio says it’s unaware of any partnership with the museum."

Your correspondent was quoted in the story after Grits blogged about receiving a solicitation from the group in August. “I don’t want to see families of troopers who die in the line of duty used as props in a scam,” Henson said. “No one does. It’s just grotesque.” 

It's not just THPA, either. Grits readers may recall that the Houston Police Officers Union runs the same kind of telemarketing operation and had one of its board members siphon off $400,000 to pay for his gambling habit.

I'd like to see the Texas Legislature in 2013 put into law that charities raising money in the name of law enforcement must comply with Better Business Bureau standards on fundraising, which dictate that at least 65% of funds raised should go to the purpose for which donors gave the money. In the meantime, somebody out there - the Texas Attorney General, a US Attorney's Office, the IRS, somebody - needs to shut down the THPA once and for all and then thoroughly investigate the two dozen other entities out there doing the same thing.

See related Grits posts:

• Millions in fundraising for so-called charity pays paltry death benefits to dead troopers' families
• Of buzzards, road kill, charity scams and the Texas Highway Patrol Association
• Houston police union rolling in cash, but six-figure thefts went unnoticed for years
• Sleazy telemarketers capitalize on public sympathy for fallen police

Millions in fundraising from so-called charity pays paltry "death benefits" for state trooper families

Following up on a story Grits covered in August, the SA Express-News today delves into the finances of the Texas Highway Patrol Association, a so-called "charity" that spends barely any of the millions of dollars it raises for its stated purpose - helping families of state troopers slain in the line of duty - and instead spends most of its money on fundraising costs and executive pay. When I received a call from them, the telemarketer said he was calling from the "Texas Highway Patrol," but the group is unaffiliated with the Department of Public Safety, which has publicly disavowed them.

The full article is being embargoed for several days (your correspondent was interviewed for the story), but they did post a set of charts giving details of the group's finances. Here are the organization's revenues for recent years (amounts in dollars):

And here's how much they actually spent on "death benefits" for families of dead troopers over the same period:

Assholes. How is it that the IRS, the Department of Justice or the Texas Attorney General hasn't pulled the plug on this scam and others like it long ago? As, Grits wrote in August, "This group is about as much about helping troopers as buzzards are about helping roadkill."

Houston police union rolling in cash, but six-figure thefts went unnoticed for years

In August, Grits criticized a phony-baloney charity called the Texas Highway Patrol Association for misrepresenting themselves in phone solicitations they claimed would raise money for the families of dead troopers, but which mostly go toward fundraising costs and into charity organizers' pockets. Now we get word that a Houston police officer was convicted last week of stealing $656,000 from the Houston Police Officers Union, including $400,000 from a phone solicitation arrangement similar to the THPA and another quarter million from the union's PAC. Reported the Houston Chronicle:

Testimony showed [Matthew] Calley stole more than $400,000 from an account dedicated to helping officers in dire financial straits and providing scholarships. It was funded by telephone solicitations of citizens and businesses.

The rest of the money Calley took was from the group's political action committee's account. Speaking to Calley, state District Judge Michael McSpadden said the 20-year sentence was because of the amount taken and "the betrayal of trust."

Calley faced punishment ranging from probation to life in prison after pleading guilty to first-degree felony theft in excess of $200,000 and misapplication of fiduciary funds.

Remarkably, this isn't the only such recent case involving Houston police union officials, reported the Chron:

Former Houston police officer Ronald L. Martin, 55, was sentenced to 10 years probation and restitution of $40,000 after pleading guilty in February to theft by a public servant.

Martin and his former son-in-law Jeffrey Larson, 43, both union officials, were indicted in 2008 on felony charges of misapplication of fiduciary property, accused of allowing between $100,000 and $200,000 to be stolen from the union.

Larson's case is pending trial.

Amazingly, union officials downplayed the impact of so much money being stolen:

Gary Blankinship, the union's president, said emergency union funds were not affected because the money was stolen gradually and not in one large amount.

"We've always had money in that account,'' Blankinship said. "Realize this went on for years and years to reach that amount. ... We were always able to meet obligations."

Blankinship said the thefts could have affected the number of scholarships awarded to children of police officers, but added they stayed "fairly consistent" over the years the theft occurred.

For union offiicials not to have noticed so much money missing from their charity and PAC tells this writer two things: 1) The union is rolling in cash, and 2) there's no meaningful oversight of how union funds are spent.