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Attorney general announces agreement with Ohio AMVETS groups following investigation

Norwalk Reflector Staff • Mar 28, 2013 at 12:07 PM

Today Attorney General Mike DeWine announced he has reached an agreement with AMVETS Department of Ohio, Ohio AMVETS Career Center and AMVETS Department of Ohio Service Foundation to protect charitable assets raised by those organizations for unemployed veterans and other veterans' services.

The agreement follows an investigation by the Attorney General that uncovered the misappropriation of millions in charitable funds held by the three AMVETS organizations for the benefit of unemployed veterans, veterans in need of career training, ROTC programs, veterans scholarships, veterans hospitals, and homeless veterans. The agreement was filed with the Franklin County Court of Common Pleas.

"The unemployment rate among Ohio's veterans remains higher than the statewide average, especially among young veterans who have served since 9/11," DeWine said. "Veterans need and deserve the assistance these AMVETS organizations provide, and going forward we will make sure they get it."

Ohio AMVETS Career Center, a 501(c)(3) public charity, funded approximately 59 AMVETS posts around the state of Ohio with more than ten million dollars since 2006 to provide satellite career centers at those posts where veterans could receive career training and employment services. However, an investigation by the Attorney General's Charitable Law Section found that the overwhelming majority of charitable assets required by law for use by the posts' career centers were being used for purposes unrelated to career services. Instead, AMVETS posts used the money for non-charitable purposes, with the knowledge of Ohio AMVETS Career Center board members and some AMVETS Department of Ohio officials.

The Attorney General's investigation eventually expanded into the operations of AMVETS Department of Ohio and AMVETS Department of Ohio Service Foundation, where it was uncovered that millions of Ohio AMVETS Career Center and AMVETS Department of Ohio Service Foundation assets, dedicated for specific charitable purposes, were transferred to subsidize the AMVETS Department of Ohio, including payroll and travel reimbursements.

Under Ohio law, 25 percent of AMVETS posts' licensed gaming profits are required to go to a public charity. Fifty-nine AMVETS Posts signed fundraising contracts with Ohio AMVETS Career Center to make it their designated public charity. Additionally, those posts contracted with Ohio AMVETS Career Center to operate satellite career centers. Approximately eighty-five percent of the funds sent to the Ohio AMVETS Career Center charity were then sent back to the posts where the money originated.

AMVETS posts were legally required to use all of these funds to benefit veterans seeking career training and employment services at their satellite career centers. However, the Attorney General's investigation found that often the posts' "career centers" were merely facades created to give the appearance of a career center. Many career centers consisted of little more than an outdated computer in the corner of the post.  At many posts, veteran attendance was sparse or non-existent, though posts continued to receive charitable assets from Ohio AMVETS Career Center.

In addition to revamped accounting and reporting practices, creation of written financial policies, and avoidance of verbal contracts as stipulated in the agreement, personnel in numerous offices and boards within the AMVETS organization were removed by AMVETS or resigned from their positions. Fifty-nine AMVETS posts have also agreed to fund the newly reformed Ohio AMVETS Career Center for the next five years and turn over to Ohio AMVETS Career Center any career center assets they possess. The posts will no longer receive any charitable proceeds from Ohio AMVETS Career Center except payment for actual services provided to the center through arm's length written agreements.

Sandy Vorhies, AMVETS Department of Ohio State Commander said,  "We are angry that veterans did not receive needed services.  We have worked with the Attorney General to resolve these issues, and we have terminated several individuals who have contributed to these problems.  AMVETS is dedicated to changing these practices and we are thankful for the Attorney General's support."

Stewart Hickey, Executive Director of AMVETS National Headquarters stated, "We have met with the Attorney General's staff and support the terms of this agreement. We appreciate Attorney General DeWine's efforts to facilitate reforms, and we will assist Ohio AMVETS in implementing them."

"AMVETS has been cooperative during our investigation and has already implemented many parts of this agreement," said Attorney General DeWine. "I am confident that this cooperation will continue, this agreement will be fully followed, and, most importantly, Ohio's veterans will get the services they need and deserve."

A new board of Ohio AMVETS Career Center will include officials who have shown a demonstrated interest in veteran support issues. The new members include Columbus City Councilman Hearcel Craig, a veteran who is Chairman of the Veterans' Affairs Committee; Curtis McPherson, Executive Director of the Warren County Veterans Service Commission; Matt Slater, Director of Veterans Services for Family and Community Services, a Ravenna-based nonprofit that serves the needs of veterans in northeast Ohio; and Terry Sayers, Chapter Commander of the Disabled American Veterans of Trumbull County.

NOTE: Copies of the statewide agreement, agreements with local AMVETS posts, and photographs from the investigation are available on the Ohio Attorney General's website.

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