'Badge Charity' under AG investigation

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by Jeremy Rogalski / 11 News

khou.com

Posted on October 29, 2009 at 12:46 PM

HOUSTON—A local charity that once settled a state lawsuit over allegations of deceptive and fraudulent business practices, is once again under investigation by the Texas Office of Attorney General, the 11 News Defenders have confirmed.

The United States Deputy Sheriffs’ Association, with headquarters in the 1300 block of Langham Creek in West Houston, takes in millions in donations each year. But the non-profit organization spends only a fraction of that on its charitable cause of helping underfunded sheriff departments.

Additionally, sheriffs across the country have complained about the USDSA’s phone solicitations.

“I don’t like my people being taken advantage of,” said Sheriff Bob Alford of the Johnson County Sheriff’s Department, located in Cleburne about 30 miles south of Fort Worth.

Alford is about as Texas as a Texas lawman can get, preferring a pickup truck over a police cruiser, and forgoing his full name for simply Sheriff Bob.

“Everybody knows each other by first names,” Sheriff Bob explained about the close-knit community.

It’s why he was bothered by the phone pitch of a group of outsider telemarketers, who were asking for money to help local deputies.

“I’ve never even gotten a piece of literature from this company, let alone money,” said Sheriff Bob.

11 News heard similar complaints from sheriffs nationwide.

“It’s preying on people, and it’s using our good name,” said Sheriff Peter Meskill of the Tompkins County Sheriff Department in Ithaca, New York.

“I’ve never seen one dime come back to the community,” said Sheriff Neil Williamson of the Sangamon County Sheriff’s Department in Springfield, Illinois.

“Particularly the senior citizens want to be supportive of law enforcement, and frankly, they’re getting ripped off,” added Sheriff James Alderden of the Larimer County Sheriff’s Department in Fort Collins, Colorado.

Stephen Van Dyke runs the United States Deputy Sheriff’s Association.

11 News: “Is your organization doing all it can for law enforcement?”

Van Dyke: “Sure.”

But a closer look at the USDSA’s non-profit filings with the Internal Revenue Service tells a different story.

In the organization’s 2007 990 form, the charity took in $5.6 million, but only spent $167,000 on its charitable mission of providing equipment and training to underfunded departments, and death benefits to families of fallen officers. That represents about 3 percent of the donations it took in.

The charity also claims another charitable action, publishing The Deputy Sheriff Magazine, which, it said, covers law enforcement trends and events. In 2007 the cost of publication was $1.47 million of the charity’s money.

“That’s an insult,” said Dan Parsons of the Houston Better Business Bureau. “I mean, that’s an insult to any donor, or anyone on the other end of the phone to be told, this is a charity. You’re not a charity. You’re a charity in name only.”

Parsons said he was also bothered by the fact that Stephen Van Dyke pays himself $171,000 a year, and pays his wife Judy Van Dyke more than $88,000 a year. Their combined quarter-million-dollar salary is more than was spent on the charitable efforts of providing equipment, training and death benefits.

The 11 News Defenders investigation showed that Van Dyke also had his sister, Susan Van Dyke, on the payroll.

“It’s a happy little family, doing police telemarketing, and they’re rewarding themselves,” Parsons said.

Others get rewarded as well. Outside, for-profit fundraisers hired by the USDSA gobbled up a large chunk of the charitable pie--$3.3 million of the $5.6 million it took in.

Add that all up and some charity watchdog groups give Van Dyke’s group its lowest score.

“The United States Deputy Sheriff’s Association is rated zero by us,” said Ken Berger of Charity Navigator. “It appears very clear in this case, that the money is not going to what is meant to be the mission of the organization.”

But Stephen Van Dyke maintained his non-profit is doing a good job.

“We’ve helped over 700 departments and put on probably 200, 300 training sessions,” Van Dyke said.

Van Dyke showed 11 News dozens of letters from sheriffs around the country over the years thanking him for providing training and donating equipment. He declined The Defenders’ request for a sit-down, on-camera interview, so we approached him one morning outside of a local restaurant.

11 News: “You’re giving a pittance to the cause.”

Van Dyke: “Jeremy, I’ll be watching …”

11 News:  “Are you really just making money for you and your wife, is this a family for-profit affair?”

Van Dyke: “I’ll be watching, I love your station, and I’m sorry that you would have to resort to stuff like this.”

But after we spoke with Van Dyke, The Defenders discovered something else far more serious—a 1998 civil lawsuit filed by the Texas Attorney General, which then called the USDSA’s fundraising efforts deceptive and fraudulent.

As for The Deputy Sheriff Magazine, the Attorney General’s office claimed that in three years, the charity published only one issue in the spring of 1998, and printed -- at most -- 500 copies. The Attorney General’s office estimated that meant a whopping $2,200 cost per copy.

The rest of the charity’s money, $1.05 million, was split, the Attorney General claimed, between the Van Dyke couple and three other employees for their personal use.

In the end, both sides settled the case, and the USDSA agreed to pay $110,000 in attorney fees and civil penalties. It was allowed to stay in business and given a list of reforms to make.

“That’s an organization that we’ve been investigating for over a decade,” said Texas Attorney General Greg Abbott.

11 News: “If you’ve been looking at them for a decade, why, why is it taking long?”

Abbott: “Well, we’ve brought legal action against them before, we’re investigating them again.”

“My gut, the case got forgotten,” said the BBB’s Dan Parsons.

Parsons pointed to two problems—no follow-through by the Texas Office of Attorney General, and not strong enough action taken in the first place.

“This was not enough of a hammer to hit them with, and they should not be in business, they should not be operating today,” said Parsons.

Stephen Van Dyke claimed the Attorney General’s original allegations from that 1998 lawsuit are simply not true, and that they were never proven in a court of law. In a statement, he also told The Defenders that since its settlement with the state, the USDSA has been in compliance with the terms and conditions in the settlement.

Van Dyke also runs a similar charity, the United States Municipal Police Association, which is aimed at helping city police officers.

But where do the vast majority of donations go for that group -- another magazine.

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