Veterans’ Group Gets $50,000 from Leftovers of Massive Charity Scam

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August 8, 2016; Stars and Stripes

In an end to one of the most convoluted stories NPQ has ever covered, Stars and Stripes reports that, at least in Ohio, some of the pennies on the dollar that were left when John Donald Cody was arrested for a massive multi-state charity fraud will actually go where they were meant to in the first place—a veterans’ charity.

NPQ readers may remember that John Donald Cody (AKA Bobby Thompson) was finally convicted in 2014 and sentenced to 28 years on charges of racketeering, theft, money laundering, and identity theft, all in relationship to the charity he founded in 2002, the United States Veterans Association. The charges have him bringing in as much as $22 million in the course of some years and around $100 million altogether but he never gave more than one percent of proceeds away. He did, though, give a lot to Republican politicians.

But how could Cody have committed this heinous crime? He was declared dead in 1997—and yet somehow still registered to vote in 1998.

When he ran the charity, he claimed it had 41 state chapters and 66,939 members doling out millions in assistance to Navy personnel, vets, and their families. But when the St. Petersburg Times tried to track him and any board members down in 2010, all that activity turned out to be so much hot air.

Rick Cohen wrote at the time that:

The top-notch investigative team at the St. Petersburg Times did its homework and discovered that the “Association members” pictured at various times on the organization’s website weren’t members and in some cases weren’t even vets. They were people associated with Donald Phillips, a Tampa real estate developer and Republican political donor, who provided his own staff, including his governmental affairs director, Michael Ciftci, and other Phillips employees and their friends to pose for Association pictures. They never seem to have protested being captioned inaccurately as unnamed “Association members,” though now that Thompson is being investigated by several states, including Florida, one of the biggest do-nothing states in terms of charitable oversight, Phillips now has a “sick feeling” about his relationship with Thompson and the organization.

But by the time they concluded that it was all a pack of lies, Cody/Thompson had packed up and moved on from his modest duplex—thus beginning his two-year long period underground.

Even after U.S. Marshals caught Cody in 2012, he lingered nameless in jail for six months—identifying himself as Mr. X—before one happened upon an old FBI “Wanted” photo with Cody’s real name. We do have to say that he was carrying at least a million dollars in his luggage when caught in Oregon.

Ohio Attorney General Mike DeWine states that the money seized during investigations of Cody/Thompson is part of a $50,000 grant being made to the Ohio Military Veterans Legal Assistance Project. But really? Is that all there is?

As NPQ has written repeatedly, the all-too-frequent scams that use veterans as bait to a sympathetic public are in a class all their own and deserve special prosecution. But we also note that this is why a robust regulatory environment is in all of our interests.—Ruth McCambridge