At the New To Las Vegas world headquarters recently, I received a telephone cold call from one Bob Malone. He was calling on behalf of American Coalition for Injured Veterans PAC. “Our vets desperately need your help,” he declared in a light Southern accent as he asked for a contribution.
Great, I said. Where is the organization located?
The next sound I heard was a click. Malone hung up on me without uttering another word.
Now that sure seems like a deal on the up-and-up, doesn’t it?
I knew immediately Malone was not a real person, but rather a computer-generated voice working with artificial intelligence and a real human being monitoring calls ready to pull the plug at the first hint of an obstacle. American Coalition isn’t all that real, either, in the sense that virtually none of the money raised benefits ailing veterans. The outfit, ostensibly based in Washington, D.C., was founded by Zachary Bass, a fellow from Baltimore I know a little bit about, and who has gotten into trouble with regulators for other endeavors.
You might get a call from one of Bass’s enterprises. So read on and be warned.
American Coalition is a PAC, or political action committee, which is supposed to support candidates and causes.That means American Coalition isn’t a charity that might actually give something of tangible value to veterans, and thus isn’t subject to regulation by charitable regulators in any state where it operates or raises money. PACs are regulated–although I am using the word here pretty loosely–by the U.S. Federal Election Committee, whose governing body is not at full strength and even when fully staffed is a pretty toothless operation.
PAC status also means that contributions aren’t tax-deductible, although Bass’s solicitors don’t exactly volunteer that information or mention it on the American Coalition website. (Its home page, by the way, uses a photo of a wheelchair-bound uniformed solider missing an arm that actually is a stock shot sold by Getty Images; the soldier has no known connection with American Coalition.)
From late 2017 when it was organized, through June 30, 2019, its latest filing, American Coalition raised $3.1 million in donations from well-meaning folks around the country who probably thought thought their contributions would, well, help injured veterans in some tangible way. But of that sum, $2.7 million was spent in raising the money, or “donor outreach” as it’s called in FEC filings. Do that math. Some 87 cents of each dollar raised went to fundraising enterprises, a motley collection of outfits in a number of states, including Nevada, and the District of Columbia. I imagine that Bass somehow got a piece of this action.
Moreover, of the $3.1 million raised, only $103,700 was spent directly on behalf of political candidates–14 by my count, all running for seats in the U.S. House of Representatives. That’s barely 3% of the money raised. Another $190,100 was spent in what the filings generally called media consulting. I have no idea what that means, but I wouldn’t be surprised if Bass got a cut of this, too. Even if this sum somehow furthered the general cause of injured veterans, added to the $103,700 it amounted to less than 10% of the total money raised.
Of course, if the expectation of donors was that their gifts would directly help injured soldiers in a charity-like manner, like providing therapy or supplies, then exactly 0% met their expectations.
Think Bass has raised a big war chest for next year’s elections to do battle on behalf of injured veterans? Think again. On June 30, 2019, American Coalition had all of $15,899.50 in the bank.
Nor am I the only journalist writing about PACs masquerading as causes for good and exploiting a hole in regulatory scrutiny. A Politico article last year about other such PACs had this bold headline: “ ‘Scam PACs’ rake in millions under guise of charity’.”
I first encountered Bass last year when I was solicited by one of his other causes, Heroes United PAC, which uses law enforcement and emergency workers as its lure under several names, including Association for Police and First Responders, and Volunteer Firefighters Association. In a post I laid out Heroes United’s dismal economics, which closely track those of American Coalition, which I also mentioned along with Bass’s Community Health Council PAC. That entity solicits under the name Breast Cancer Health Council, from which I also have gotten a call. I know of at last one other PAC listing Bass as treasurer, United Police Officers Association.
But word is finally getting around. Last week in Maryland, the Montgomery County Office of Consumer Protection announced in a press release that Heroes United employed a “fraudulent business model” to solicit donors in that wealthy Washington, D.C.-area jurisdiction. The agency said that Bass and an associate, Matthew Greenlee, signed a settlement agreement requiring Heroes United to contact all Montgomery County donors since 2017 and offer full refunds. The press release said that Heroes United PAC also settled with North Dakota regulators in 2018 over violations of that state’s “robo-caller” law.
I sent a request for comment to Bass to both his personal email and through the American Coalition website, laying out many of these points. I’ll update this post if I hear back.
Who knows? Maybe I’ll even get another call from Bob Malone. It certainly can’t end any more suspiciously than the last one.
Hi, Ray. Thanks for the encouragement.
It never stops. Keep after them, Bill.