Friday, October 14, 2011

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:


MailDeadDrop said...

Why limit it to charities allegedly working to benefit law enforcement? Why not simply say: "to qualify as a fundraising charitable organization in Texas, at least 65% of revenues must go towards the recipient group(s)."

FOP Telemarketing said...

The last time The Lege tried to outlaw this practice, the Texas FOP lobbyists went into high gear and killed it.

Follow The Money.......

DEWEY said...

I volunteer for a non-commercial radio station (KPFT). When I get calls from these "charitable" organizations, I turn the table and ask if they would like to contribute to the station. I don't give them a chance to do their "pitch".