This story was originally published on Jan. 27.
UPDATE: The Wounded Warrior Project has published a letter it sent to CBS News in response to the investigation. You can read it here.
The Wounded Warrior Project, a national nonprofit organization that supports service members wounded in the line of duty, has been accused of blowing millions of dollars in donation money on spoils for its staff, according to a new two-part CBS News investigation.
The CBS investigation was reportedly inspired by Charity Navigator, a nonprofit organization that promotes fiscal transparency among charities. Its scrutiny of public records found that WWP spent a mere 60 percent of its donations on veterans, the remainder of which the CBS News team set out to account for.
"According to the charity's tax forms, spending on conferences and meetings went from $1.7 million in 2010, to $26 million in 2014," the report reads. "That's about the same amount the group spends on combat stress recovery — its top program."
Officials with the WWP denied CBS' requests to speak with its CEO Steven Nardizzi.
On Wednesday, the WWP issued a statement on its website calling the CBS story a "false news report." The organization called itself an "open book" and "a leader in nonprofit transparency." It also faulted CBS for allegedly not contacting WWP's top auditor to check the numbers prior to broadcasting the story. The auditor, Richard M. Jones, "stands by our financial statements, our reporting methods, our public filings, and our independent audits," the statement reads.
The statement also notes the WWP's recent multimillion-dollar investments in its new Warrior Care Network among other programs.
In an email, a WWP spokesperson told Military Times that the organization intends to post at least some of the material it provided to CBS.
Ryan Kules, a spokesman, defended the organization's spending, telling CBS that the conferences and meetings enhanced team-building, organizational alignment and service quality. He refuted accusations, made by former employees, of excessive spending outside of WWP conferences and that WWP used donation money to purchase alcohol, the report says.
CBS News says it interviewed more than 40 disillusioned ex-employees for the report. Their allegations of excessive spending include claims that:
- WWP employees were directed to stay in an expensive hotel during a conference, despite living locally.
- The CEO, Nardizzi, spent money on extreme entrances to events — once even rappelling off of a building.
- The organization paid $3 million for its employees to attend a three-day WWP conference. The report noted that Kules also challenged this accusation, but said that he was unable to provide a corrected cost figure and claimed that he did not attend that particular event.
The second part of the report aired Wednesday on "CBS This Morning." You can watch it below:
This is far from the first critical media coverage of the WWP in less than a year.
On Wednesday, the New York Times released a similar special report about the charity's spending.
In April, Hampton Roads, Virginia-based News Channel 3 attempted to delve into some of the same Charity Navigator data that CBS examined, though its piece mostly focused on Nardizzi's apparent opposition to so-called "charity watchdogs." due to his belief that they tracked the types of data when compiling their analyses.
"Nardizzi said the best way for a potential donor to gauge a charity is to research the charity directly, without relying on charity-watchdog websites," News Channel 3's Matt Knight and Time Mather wrote.
That report made a point of underscoring the value of donors performing independent checks, claiming that the news team's "investigation shows how a charity and a charity-checking organization can review the same data and come up with different results."
And while the CBS News investigation said that multiple employees have drawn a correlation between Nardizzi's occupation of the CEO role in 2009 and an influx in questionable spending, this isn't the first time his financial attitudes concerning WWP have landed him in hot water with the media. A June report by The Daily Beast criticized Nardizzi, saying he pays his executives too much.
"Nardizzi is an advisory board member of the Charity Defense Council, an outfit with lofty ambitions," The Daily Beast's Tim Mak wrote. "The organization wants to remake the entire charitable sector to be more permissive of high overhead and high executive compensation, explicitly citing as its model the oil industry's efforts to rehabilitate its public image."
Poynter's Chief Media Writer James Warren praised CBS News' Chip Reid and Jennifer Janisch for pulling off the investigation earlier Wednesday.
