Leadership Booted at Dishonored Veterans Charity Ordered to Pay $2.5 Million Restitution
Despite having raised donations amounting to tens of millions of dollars from well-meaning donors while using significant portions of it to enrich himself, Roger Chapin was an expert at maintaining a positive public image over his lifetime spent as a self-described "non-profit entrepreneur." Chapin passed away in August of 2013 just before being subjected to the potential public backlash resulting from a recent legal settlement announced by California Attorney General (CAG) Kamala D. Harris on September 6th, 2013. The CAG had filed suit against Help Hospitalized Veterans, founded by Chapin, and its executive officers and directors in August of 2012 for, according to the press release, "diverting funds intended to support programs serving veterans and active-duty military… Executives used these funds to pay for fundraising and excessive compensation."
While Chapin's passing may have ultimately spared him of the embarrassment associated with the CAG's announced settlement, there is some good news for veterans and the donating public. As part of the settlement in People v. Help Hospitalized Veterans, et al, officers and directors of HHV named in the suit must resign and pay a collective $2.5 million in restitution. HHV will eventually receive restitution of $2 million from the Chapin Trust, and $450,000 from the charity's director and officer liability insurance policy on behalf of the defendant officers and directors.
Michael Lynch, who replaced Roger Chapin as president of HHV in 2009 after serving at the charity in other capacities for decades, must retire from his position as president and resign from the board under the settlement agreement. The other directors named in the suit, Thomas Arnold, Robert Beckley, Gorham L. Black III, and Leonard Rogers, must also resign. All, including Lynch, are barred from acting as an officer, director, fiduciary or trustee of any California charity. Exiting board members will recommend their own replacements, but new board members will be subject to the approval of the Attorney General's office prior to being installed.
CharityWatch has for years warned donors about HHV and another of Chapin's charities, Coalition to Salute America's Heroes, consistently issuing failing grades to the groups.