Tax records show charities spent millions on direct mail

Reminder these groups are not the Disabled American Veterans, DAV

Tax records show charities spent millions on direct mail
By David Fitzpatrick and Drew Griffin
CNN Special Investigations Unit
Fri May 18, 2012

STORY HIGHLIGHTS
Tax records show two veterans charities spent more than $78 million on direct mail marketing
One of the charities is trying to end its relationship with the marketing company
CharityWatch gave both charities an "F" for spending only 12% on helping veterans
"Who's benefiting here other than the fund-raising company?" asks CharityWatch

Los Angeles (CNN) -- If you've ever wondered how much money charities spend mailing you those glossy brochures and free address labels along with their request for a donation, the answer might surprise you.

CNN has found that this type of direct-mail marketing cost two veterans charities tens of millions of dollars.

Los Angeles-based National Veterans Foundation raised more than $22 million in donations over the past three years to help veterans, yet spent approximately $18.2 million paying its direct mail fund-raisers, according to IRS 990 forms.

For nearly a year, the charity has been trying -- without success -- to get out of its contract with Brickmill Marketing and its parent company, Quadriga Art, according to NVF's Rich Rudnick.

"We were told for two years it would be very expensive, then we'd be going into the black," Rudnick told CNN. "That never happened."

Quadriga Art is one of the world's largest direct-mail providers to charities and non-profits. Quadriga Art is the same fund-raiser hired by the Washington, D.C.-based Disabled Veterans National Foundation, which collected nearly $56 million in donations over the past three years, yet paid Quadriga Art more than $60 million in fees, according to a CNN investigation into the charity's tax records.
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