Now that a second audit of Wounded Warrior Project’s financials was ordered by the Board of Directors thanks to a lot of bad publicity, and the top two EMPLOYEES have been terminated, more details from whistleblowers and the audit itself are coming out.
In February, the group’s board hired the New York law firm Simpson Thacher & Bartlett to perform an independent review.
The review confirmed many of the findings by The Times and CBS, according to a news release from the public relations firm, and the board has instituted changes to limit first-class travel, track changes and increase accountability.
Since the mismanagement of donations at Wounded Warrior Project started to surface last fall, there have been all sorts of extreme cases of dismay and astonishment that ANYONE would think it is okay to treat other people’s money meant to help others that way. The range of outrage was targeted at the new headquarters building the group built, the antics of the Chief Executive Officer, budgets for staff retreats…all things that are visible.
The Daily Beast gives us some of the objections of the whistleblowers who have contacted them:
- $250,000 budget for candy and snacks at the company’s headquarters.
- Team building exercises twice a week.
- Providing each employee with the book Good to Great by Jim Collins, and using it as a training manual.
- Wear a polo with the logo on it and do as your told.
- Watch videos featuring the CEO walking through Times Square.
As a veteran of non-profit, some of this stuff is VERY familiar. Our budgets for food and retreats were never that big, but, yeah, the non-profit would pay for stuff like a sit down dinner in a ballroom or nice restaurant for the Annual Meeting. One time, a CEO paid for everyone on staff to get a back massage. This writer was given copies of Good to Great at two different non-profits, and spotted the book at a third. It was held up within the non-profit world as a go-to book at some point about ten years ago, and that notion seems to not have waned. Multiple places I worked, we were issued logoed apparel and were expected to wear it to events, and official activities. Digitizing a logo for a polo is not cheap, but thin, crappy t-shirts really give off the wrong vibe.
There was always “the chapter” way to do things when out in the world and being identified as a person of authority for the organization, not unlike what happens in business. Every staff meeting there were team building activities…not that they ever worked. An office is an office, and the same bullying and backbiting happened at all the non-profits as do in regular business. (Plus, two of the CEO sorts I worked for in non-profit were scheming social climbers. It’s an easy way to rub elbows with big money and gain entry into certain social circles, even if the person is never accepted that high on the food chain.) All the same human resources seminars were done with the same results. (No, the Fred Pryor seminars did not get any better the more we sat in them.) “How To Deal With Difficult People” was put down in the session by the very people who needed to digest the information.
Some of this stuff is actually standard operating procedure, and there is no reason Wounded Warrior Project would be any different if their management and leadership were attending professional non-profit conferences, and reading the industry journals.
However, what SHOULD be highlighted as perfectly objectionable, and hasn’t really surfaced just yet other than passing mentions of how poor the services were to the veterans at Wounded Warrior Project, was that the programs were more along the lines of spending cash for big event photo ops than actually developing mentoring programs, and working with other veteran related non-profits to get veterans the services they need just didn’t happen. In January, when this writer started digging into the financials of the organization, assets were listed at $250 million, most of it in cash. Veteran homelessness is a national disgrace and this organization was hoarding money. Having one year’s worth of expenses in the bank to maintain continuity in staff is one thing, but donors expect their cash to be used to help the victims, not get stashed in a bank account or invested in equities.
Another detail that is different with the March reporting against what the official financials said in January is that the administrative overhead is now listed at 40% rather then 19%. Earlier reporting indicated that line items were allocated and parsed to make the program expense numbers look better than they were. This does happen in all non-profits, but with a reported difference of 21%? Yeah, no. In addition, administrative overhead should be between five and ten percent. It is necessary, but should not be excessive.
More from The Daily Beast:
“The problems at WWP start at the top but this is a systemic problem that permeates through the culture of the organization. Ultimately, the selfish attitudes, egomaniacal actions, and self-interest led to donors being lied to and veterans being used for personal gain.”
“It’s a dysfunctional, broken organization that is in need of some severe repair and oversight—it extends all the way down to the director and lowest levels of management. [The attitude is] that we don’t answer to anyone, and we can do whatever we want once donors give us the money,” Millette added.
Yes, that is what happens with unrestricted funds, or donations. It goes into a general pot. Anyone who wants to donate cash to any charity, and wants it to go to programs, that can be specified on the check, or in a letter. If there is a comments box on an online donation, express your desire. There is nothing the non-profit can do about that. The donor’s request must be honored even if unrestricted funds are the goal of every development professional.
From the New York Times:
“To best effectuate these changes and help restore trust in the organization among all of the constituencies WWP serves, the board determined the organization would benefit from new leadership, and WWP CEO Steve Nardizzi and COO Al Giordano are no longer with the organization,” the news release said.
The board chairman, Anthony Odierno, will temporarily take control of the charity, according to the release. Mr. Odierno, a retired Army captain who was wounded in Iraq, is the son of Gen. Raymond Odierno, a former chief of staff of the Army.
“It is now time to put the organization’s focus directly back on the men and women who have so bravely fought for our country and who need our support,” Mr. Odierno said in a statement.
The Crisis Public Relations firm is doing its best. However, it may very well be too little too late. Stay tuned.