god save the queen. "ac 360 starts now. "ac 360" starts now hey, welcome, everyone. tonight, keeping them honest special. an investigation into charity cheats. when you open your heart and wallet to help a charity, how do you know your money is going to be put to good use? in the next hour, we'll bring you drew griffin's investigation into charities and not spending where donors expect. one of the charities under scrutiny is called disabled veterans national foundation, dvnf. remember those initials. there's no sign that the cash donations, more than $56 million they've raised over three years, went directly to the men and women who sacrificed so much in war zones. not one dime of that money. because of drew's reporting, the

senate finance committee is now demanding answers from the dvnf. they have launched an investigation into its practices. more on that tonight. drew also uncovered yet another veterans charity, called the national veterans foundation, which is taking donations but using only a very small percentage to actually help vets. there are also charities that claim to help abandoned animals but the money trail led somewhere else entirely. baghdad pups has raised millions to reunite military personnel was the animals they served overseas. but as far as we can tell, they don't do that at all. and the montreal spca, a canadian charity, received about $13 million in donations over three years but despite all of that money, they've ended up in the hole more than $4.5 million. all of these charities have one

thing in common. they all have connections to a fundraising company called quadriga art. the company gets paid to build mailing lists. >> where is the money going? i'm trying to reach mr. shuloff? he's not in? >> here's the question. over three years and none of the money has gone to any veterans. ma'am? >> you think if the money was going where they said it was going and everything was on the up and up, you'd think they'd want to be completely transparent, right? drew has been investigating this for years in some cases, and they are refusing to answer. literally getting doors slammed in his face. tonight, you'll see what he and his producer, david fitzpatrick, have uncovered during their investigation. and later on we'll also tell you what you need to look for in order to make sure that a charity that you want to donate money to, to make sure that they are doing the right thing with your donations. we begin with the veterans charity that has a lot of explaining to do.

a lot of americans feel duped that after learning that the money they donate donated to h veterans never made it to those in need. here is drew. >> mary supports veterans. so she wasn't surprised one day when she opened her mailbox and found this. >> your husband's name on them? >> uh-huh. uh-huh. >> in the fundraising industry, they are called guilt packages. and when this one arrived, a big calculator and a calendar book with her husband's name on them, mary ellis felt the guilty tug to make that donation. >> and, see, it's disabled american veterans. how many people are going to look at it and think that they are the same organization. >> and they are not. >> no. >> in fact, the gifts were not from the well-known american disabled veterans, but from a newer, much smaller chacharity,e disabled veterans national found

d ation. something didn't smell right. this retired english teacher did research and found that the dvnf gets an f from a charity watchdog group. according to its tax filings, raising nearly $56 million in donations for veterans for the past three years. but according to the records that cnn found, none of that 56 million has gone to direct services for veterans. >> making lots of money off of it. i mean, when you're talking about millions of dollars that people are doing by grabbing money from people who don't have it. >> who believe out of the goodness of their own heart that they are giving money to -- >> a worthy cause. >> reporter: the purpose is to try to explain to me why these numbers don't add up. cnn has been trying to reach the disabled veterans national foundation off and on for nearly two years. a public relations man did

return our phone call outside the group's washington, d.c. headquarters in 2010, but the manager refused to talk. despite e-mails and more phone calls, our repeated requests for interviews were all denied. >> up to $2 billion is raised in the name of veterans in this country and it's so sad that a great deal, hundreds and millions of dollars, of our charitable dollars intended to help veterans, is being squandered and wasted by opportunists and individuals and companies that see it as a profit-making opportunity. >> reporter: daniel runs a charity watchdog group out of this office in chicago. he grades charities on how much good and bad they do with your donations. veterans and military charities are some of the worst, he says. and that includes the disabled veterans national foundation,

which he gives an "f" because hardly any of the donations make it to the people that the group is fundraising for. so back to that 56 million the group has raised, if it hasn't gone to direct contributions to veterans, where exactly did it go? as far as we can tell, up to the tenth floor of this manhattan building to a company called quadriga arts, a company that specializes in fundraising. as far as we can tell, quadriga arts knows a lot about fund-raising -- for itself. quadri quadriga, according to its website, raises money for more than 500 charities and non-profits worldwide. in an e-mail to cnn, a company spokesman says it does not discuss specific client relationships but that spokesman did say quadriga at times chooses to invest money in partnerships with nonprofit organizations. to date, quadriga told cnn they actually lost 7 million

investing in non-profit organizations. that may be true but in the case of the disabled veterans national foundation, according to tax documents, not only did nearly all of the 56 million in cash donations go to fundraising costs, but the dvnf still owes its fund-raiser another $5 million. it sounds like backward math. dvnf is reporting on its tax returns that it's costing more than a dollar to raise a dollar, despite the fact that its fund-raising contract, quadriga, says it wins its fair share of business because it is a low-cost provider in the non-profit marketplace. >> it's like printing money. they print these solicitations, they send them out to millions of people. they don't care -- they don't care about the percentage of returns. all they care is about how much money they get from it. >> you're the one from cnn that's -- >> reporter: that's right.

meet priscilla wilkewitz, president of the veterans national foundation. who we found at a small vfw office in baton rouge. >> i really didn't think you'd do something like this and we've agreed to talk to you and answer your questions. >> reporter: nobody has agreed. so he's the question, none of the money has gone to any veterans. ma'am? >> while wilkewitz is the former national legislative liaison for the veterans of foreign awars, it's another veterans group she's president of that we wanted to discuss. the bottom line is, you are not going to give me an interview? cnn has been trying for two years to get an interview with the disabled veterans national foundation since we've began tracking its organization. we've gotten angry phone calls, angry e-mails, promises of written responses, and now a slammed door. ma'am? but no answers. and when you see just how this charity operates, you'll understand why. >> we're paying down our start-up costs. >> wilkewitz on the organization's website likes to

boast about the charitable gifts that her group gives away. and dvnf does give away stuff -- stuff actually veterans groups say they really don't need. it's called gifts in kind on tax forms. instead of giving away some of the $56 million in cash raised over the past three years, dvnf gives away stuff it got for free. in 2010 the group filed this tax form claiming it provided more than $838,000 in gifts in kind to u.s. vets, a charity in arizona. u.s. vets showed us what actually was sent. 20 pairs of men's football pants, more than 100 chefs coats, 125 chef's aprons. a needle point design pillow case. two pages worth of stuff the director told us, we don't need. and take a look at what showed up at the st. benedicts veterans

center in birmingham, alabama where j.d. simpson takes homeless vets off the streets. he said the modest shipment included some useful items. 2,300 disaster blankets good for a couple days' use and some cleaning supplies. but it also included this. >> they sent us 2,600 bags of cough drops and 2,200 little bottles of sanitizer and 11,520 bags of coconut m&ms. and didn't have a lot of use for 11,520 coconut m&ms. >> here's what they posted on their website about the work they were doing in alabama. >> we send by the truckload items that these centers and shelters say they need desperately. >> for our veterans that have given so much to our country and now need our help. >> great sound bite. >> did they ever ask you what you wanted? >> no. they always call and say, we've got a truckload coming. >> everything up here on the top

is a lot of the stuff that came in on the last truck. the bandages, the lotion, the hand sanitizer with -- >> it's unpacked. >> it's unpacked. >> because you don't -- >> we really have no use for it. these shelves should be filled with this. >> food. >> not that. >> do you ask yourself, well, where's the money? >> i ask myself that after i ask myself what the heck are these people doing stealing from our veterans? because that's what they are doing. i don't care how you look at it. these people have sacrificed for our country and there's some people out there that are raising money to abuse it and that just makes me mad. >> executive director j.d. simpson became even more angry when these showed up, more than 700 pairs of surplus navy dress shoes. >> not a lot of use for these unless you are going through

personnel inspection. >> those are now part of a yard sale to raise funds for things they really need -- not shoes like this. >> here is the question. >> priscilla wilkowitlz will not tell us why she sent homeless vets in alabama shiny new shoes. the dvnf really wouldn't tell us anything. what the group and its president continue tell you, the american public, is to keep sending in those donations. >> drew, this is really just unbelievable. how does this charity get away with this? how can they take in this money and not give any of it directly to the people they say they're collecting it for? >> anderson, part of our mission here is that if people actually donated and saw where their money was going or not going, all going to a private company, in fact, this fundraising service business operates, i don't think they would get away with it. legally, though, there doesn't seem to be much policing of these groups. but for the nonprofit watchdog groups that rate this charity as

an "f." >> and all of the money seems to be going directly to the company which is raising the funds. is that their business model, is simply raise money for themselves? >> you know, that seems to be the bottom line. a we've been told in e-mails from the company is that the goal maybe is not to collect money to go to veterans, but to build a sustainable database of names to be used for future pleas. quadriga has told us that they have been successful in taking this start-up charity and now having a huge mailing list to work with. but, again, no real money for the actual disabled vets. just a big mailing list. >> it's unbelievable. we'll continue on this. let us know what you think. we're on facebook. follow me on twitter, @andersoncooper. up next, drew tries to get answers from the disabled veterans national foundation. what happened to that $56 million that they raised? he tracked down the vice president of that group. we'll hear what she told him next.

more now about the claims of raising money for disabled veterans. when you hear somebody say they're raising money for disabled veterans, sounds like a great cause, a great organization. drew griffin has uncovered it's going to make you very, very angry. the group he's investigating is called the disabled veterans national foundation, dvnf. they've got an official looking

seal. that's it right there. they've raised an awful lot of money. as drew reported before the break, according to their own tax filings, dvnf has raised more than $56 million in the past three years. $56 million. that kind of money you would think there would be a lot of disabled veterans who they would help directly. and you'd think they'd want to show off exactly where that money has gone, right? that is not the case. drew griffin joins us again. also with us is cnn senior analyst, jeffrey toobin. drew, you tracked down the vice president of this group. did you get an idea of where all of this money is going? >> no. the answers are very vague. let me set this up for you. we went to sacramento because precilla wilkewitz, the woman who slammed the door in my face, was going to be a presenter at the conference. she did not show up. we found the vice president. she did answer our questions but really without answering anything specific. >> i'm here asking actual questions for your donors and our viewers about the $56 million that they thought they were giving to actually help the disabled veterans. >> well, the cost of fundraising

is high, as you know, and it has been many veteran service organizations who use this kind of direct paying approach. >> what is the point of a fund-raiser when all of the funds go to your private fundraising company? >> well not all of the funds do. >> well according to the documents we've been filed by your organization, they all do and more. 56 million -- >> i think you need to talk to our washington, d.c. office. >> quite frankly, i've been trying for two years to get answers. >> i'm a volunteer on the board. >> are you concerned about how this fundraising drive has gone? >> no, we have done nothing illegal. >> i know you have done nothing illegal. would you like to have more money going to the veterans or some money going to veterans? >> absolutely.

there is money going to the veterans. we approve grants to individual veterans and veterans organizations on a monthly basis. >> i see no evidence of that other than gifts in kind program. >> it's infuriating that she falls back on just i'm a volunteer on the board. she's serving on the board. she should know everything going on with this organization. and, i mean, they're not being transparent. they're not being up front here. they say they are not doing anything illegal, but that's not the issue here. have you been able to find any evidence of that? >> no. we have been looking, anderson, at this group's paperwork that they file with the irs, the lists of what they have to show the irs, to find any evidence, any actual dollars are going to veterans groups. we've also been begging them to show us other books, show us any proof that it's happening. we simply cannot find it. it's just plain and simple. they have not been able to come up with one documented piece of evidence that shows us, yes, here's money that was donated and here it goes to the veterans who need it the most. >> what is so sleazy about this, after that interview you would assume if they had money that

they were giving every month to veterans groups, after you confronted that woman on the board, that you would have gotten a call the next day and they would have said, look, here's all of the documentation, here's where all of the money is going. they haven't done that. we've been on them for months. you've been on this for years, and they have yet to really give a sit-down interview. i just find that -- if they are doing nothing wrong and they're being transparent and they are asking people for money, they should sit down and do an interview and explain. apparently they're unwilling to do that. >> what you'll hear from the watchdog groups, good fund-raisers do just what you say, anderson. they have nothing to hide. >> she said, as you know, fund raising is expensive. it's expensive when you sign up with quadriga art, apparently, because of the $56 millions that they've raised has gone into quadriga art and all they've gotten for it is a bigger mailing list so they can raise more money down the road. >> a bigger mailing list and a bigger debt to quadriga art.

this group is in debt to their fund-raiser. it's expensive, that the one thing. but to go in debt to a fund-raiser, they're actually taking more than a dollar to raise a dollar. >> as a board member did you have any idea that the costs would be this high, $56 million would be paid just to get a list of people? >> we did not how fast this would take off and how well it would do. >> how can you say how well it would do when the money is going to quadriga? >> when we first started this, we didn't know how fast it would take off. >> you're basically taking money that people want to go into veterans' pockets and giving it to a private company. >> it's worth it for every veteran that we can help. >> no matter what the cost? >> hi, excuse me. >> i put on women's veterans conferences in my home state and we spend several thousands of dollars, they're donated

dollars. and my philosophy, my personal philosophy has always been, if we can help one veteran, every dollar we spent is worth it. >> even if it's $56 million? >> well, i'm not going to answer that question. >> you know what? i'm sorry. if you can only help one veteran and you've raised $56 million, shame on you. i mean, that is the biggest cliche of -- if i can help just one person. it sounds good if it's like a result of a bake sale. but, jeff, if you raised $56 million and you only helped one person -- is this legal? >> well, this is an amazing area of the law that frankly i didn't know much about. unfortunately, charity scams are not new. and states have tried to regulate them over the years. north carolina certainly made an effort in this area. what the supreme court has said is that charitable requests are protected by the first amendment. that it is very hard to make scam charities illegal as long as they fill out their paperwork correctly. as long as they report honestly

to the irs, you know what, we raised $56 million and it cost us $56 million. as long as that's true, as it appears to be true here, there doesn't appear to be any criminal offense involved. >> it's infuriating because maybe it's legal but it seems incredibly deceptive and also i don't know if that woman is just naive or stupid or deceitful. i'm not sure which of those things, or just embarrassed to admit that she's in over her head. but for her to be backing up raising $56 million, that has all gone to this company and they are now in the hole to this company. >> right. i think all those adjectives might apply to her. but let's concentrate on where the money goes and who is making money here. quadriga doesn't even pretend to be a nonprofit or a charity. quadriga is making an enormous amount of money by churning these charity lists. that's where the money goes. they're the people making money. this woman strikes me, she's

probably well intentioned but she's obviously in way over her head here. the problem is quadriga, not these charities. >> how these people sleep at night -- >> it is grotesque but they are going to be sleeping in their own beds, not in prison. because the law really does protect them. >> on very high-thread count sheets, no doubt. >> i think so. >> we'll have more on quadriga later in the program. coming up, we'll talk about another charity that drew has investigated, millions of dollars invested into baghdad pups, supposedly helping abandoned dogs in afghanistan. why are pennies on the dollar just going to help animals? and the group admits it hasn't rescued a single dog yet. you won't believe what drew has uncovered. 15% today if you open up a charge card account with us. >> you just read my mind. >> announcer: just one little piece of information and they can open bogus accounts, stealing your credit, your money and ruining your reputation. that's why you need lifelock.

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welcome back. we're spending the hour tonight looking at charities that are taking your money and as far as we can tell not delivering on their promises. in some cases, not even close. we think it's important information, but the last thing we wanted to do is give the impression that all charities are bad or that you shouldn't give at all. that would be terrible. so in a moment we'll talk with the leaders of two groups that actually track nonprofits. they are going to share with you what you should do to make sure your donations go to good use, how you can check up on a charity basically. after all, when you're being generous, you want to do good, help people, you want to make sure that you are actually helping someone in need. before we do that, though, we want to talk about a charity

doing heroic work helping veterans. here again is drew griffin. >> he's gotten candy, cough drops, and hundreds of pairs of shoes he didn't need or ask for. now j.d. simpson has a message for those who want to help him support the small veterans shelter he helped found three years ago in birmingham, alabama. >> i'm fed up with everybody out there saying, hey, let's go help the vets. it's like the flavor of the day. don't say you're going to do it. do it. >> simpson and his buddy founded the st. benedict's veterans shelter with almost no money. they struggle every day to keep it open. the mission, simple, help vets get help, hungry vets get food, homeless vets good shelter. for three years the only real struggle to keep the mission going is money. >> my budget was at $200,000 this year and that's just enough to pay for gas for the van, pay the insurance and by food.

that's not to pay for the salary of anyone who works here. we're all just volunteers. >> he recalled the day a veteran showed up in a wheelchair. >> we had a veteran that showed up during a rain storm. we picked him up and carried him in here and they helped us with that ramp. and that gets quite a bit of use. >> since that day, the charity, the disabled american veterans, has sent simpson $400 a month for gas, not coconut m&ms. >> we don't need an astro n nomically silver bullet. we need people pulling together saying, let's do something about this. let's get off the sound bites and get in the streets. >> st. benedict's is tiny. both simpson and his friend rich say it does the job, taki taking homeless vets off the street. >> do it all again? >> in a heartbeat. we really would. there's enough success stories out there, enough -- we're not going to go to tahiti on our retirement but it feels good knowing when a daughter calls

you and thanks you for giving her daddy back. drew griffin, cnn, birmingham, alabama. >> in all of this reporting on bad charities, it's nice to see someone doing some good work. and there are many others out there. we'll have information coming up on how you can identify which charity is actually using the money that they raised wisely. we'll have more of what drew's investigation uncovered as well. but, first, a 360 news and business bulletin. >> hey, anderson, police have ex-french president nicolas sarkozy. they are investigating whether he received illegal campaign contributions. >> the jetblue pilot who had a meltdown on a flight was found not guilty by reason of insan y insanity. he was restrained by the passengers and the flight was diverted. scorching heat for much of the u.s. still no power for millions from indiana to delaware.

>> and actor andy griffith has died. he was best known for "the andy griffith show." decades later he also starred in "matlock." greatly missed in his hometown, mt. airy, north carolina. good friends and nice folks there. andy griffith, 86 years old. anderson? up next, drew griffin on the money trail, charities saying they're doing good work, donations helping those in need, but that's not the case.

hey, welcome back. we're continuing our investigation on charities that

collect millions of dollars from donations from well-meaning people around the country but end up spending very little or any of that money helping anyone, except for themselves. so far we told you about the $56 million raised by the disabled veterans national foundation for over three years, none of that money -- none that we could find, has gone directly to help veterans. the million dollar question is, where is all of the money going? >> as far as we can tell, up to the tenth floor of this manhattan office building to a company called quadriga arts, a company that specializes in fund-raising. and as far as we can tell, quadriga arts knows a lot about fundraising for itself. >> the company is called quadriga arts. they provide mailing lists to groups like dvnf. but drew has had trouble getting answers to what it's been doing with all the money. watc watch. >> may i ask who's calling? >> it's drew griffin. griffin. >> he is not here. what is this regarding? >> i'm trying to reach mr. shoeloff.

oh, he's not in. >> drew's reporting on dvnf caught the attention of the senate finance committee and they launched an investigation into possible abuse of the ta tax-exempt non-profit status. the committee is requesting information. i spoke with senator max baucus, the chairman of the committee. >> what disturbs you the most this disabled national veterans foundation? >> it sounds like it's a front. i don't think it's legit. they take about $56 million from ordinary good americans who want to help veterans, but they don't give any of the money to veterans, and in this case they don't give any of the money to disabled veterans. it's an outrage, frankly. >> have you heard of the dvnf before? >> i have not, frankly. you highlighted it in one of your reports. >> senator max baucus giving a nod to drew griffin's

reporting. dvnf is not the only charity that drew has been highlighting. he also investigated a group that supposedly helps animals. it's spca international. it has a similar losing connection to qaudriga art. it's called baghdad pups. they've raised millions of dollars to reunite military members with abandoned dogs they served with overseas. but they don't really do that at all. once again, here's drew griffin. >> in montreal, the needs of the local spca were great. abandoned dogs and cats needed help, and the money to help them ran out. so in 2005, what seemed like a great opportunity came knocking. a private fundraising company called quadriga art proposed an expansion. montreal's spca would become cat canadian spca, and quadriga art would send fund-raising mailers across canada. the money started rolling in,

but there was a big problem. practically every dollar that came in, according to montreal's new spca director was going directly into the coffers of quadriga art. the fundraising bill so large that after three years, the montreal spca, despite receiving about $13 million in donations, was in the hole more than 4.5 million. >> how do you get in debt to a fund-raiser? >> by incurring expenses and not having a plan for getting out of it. it was not a smart decision on the spca's part and we let quadriga create strategy for us. >> the strategy was simple. quadriga art would send out pleas for money on behalf of this shelter, include tote bags and other gifts made by quadriga art's chinese factory, but the costs far exceeded the donations and the spca was locked into this contract for seven years. the fundraising operation was so upside down for the montreal spca that they actually still

owe quadriga art nearly $2 million and quadriga has even taken out a lien on this animal shelter. >> it's a lot of money. >> it's a lot of money but it's a lot less than the $4 million we owed them seven years ago. >> quadriga art and its president, mark shoeloff, pictured here in an ad for an unrelated charity, have repeatedly denied an interview to explain the unique process of raising money. the cost at the beginning of raising funds by quadriga to develop long-term strategies to create donor lists and create databases that would eventually pay off. the spokesman told us, quote, this has been a proven model for 50 years despite being criticized by some charity watch groups. but at the montreal spca where the contract has been running for nearly seven years now, the results have been a disaster. >> will you sign with them again? >> probably not.

>> that is hardly the end of this story. >> my name is drew griffin and i'm with cnn. >> yes. >> meet pierre, fired by the montreal spca board, only to be founder of a new u.s.-based charity, spca international. from his home in montreal and a rarely staffed office in new york, bernardi and quadriga art have designed a new charity to tug on the heartstrings called baghdad pups. the goal? reunite vets and their war pets. the televised appeal with an unwitting former military dog handler on cnn's sister network, hln in 2011 was heartwarming. >> our salute to the troops today is live in the studio with jerry barns who has nugget with him and sitting right beside nugget is terri with the spca

and ivy is down at my feet. >> terri crisp with spca international was telling our viewers that ivy and nugget were two bomb-stiffing dogs that had worked for a u.s. contractor in iraq and had been essentially abandoned by the company. she rescued them and was trying to find them homes. an hln anchor robin meade, understandably, couldn't believe it. >> how is it that they fall through the cracks and get stranded there? that's unthinkable to me. >> it is unthinkable. that's why spca international is making sure that these dogs don't get forgotten. and that they get brought home. >> it turns out, ivy and nugget weren't abandoned at all. it also turns out that the person telling us so, terri crisp, has been accused in similar situations before, begging for money to save animals that weren't being saved. the military contractor in iraq actually says ivy and nugget had been retired and the company had found them good families who were going to adopt them in kurdistan.

good homes the contractor told cnn. that's when terri crisp came along and asked if the dogs could, instead, be donated to spca international. the contractor agreed. but terri crisp didn't tell the viewers that. what she did tell us is that if we just gave her money, spca international would be doing something few americans could resist, saving the pets of our iraq and afghan vets and that's where peggy comes in. >> when this showed up, what did you think? >> well, to be honest, when this showed up, i opened this up and this is what i saw. i thought this was fantastic. i was on board because i thought saving animals and supporting the troops, you know, what two things could be better? >> what peggy got in the mail was a plea from the spca international and operation baghdad pups, a direct mail package from the fundraising powerhouse, quadriga art, the guilt package, as they are

called in the business, included this t-shirt a tote bag, and letters of thanks. peggy decided to do a little research. >> 6 cents out of a dollar, approximately, would have gone to actually saving soldier's pets. >> that's what you figured out? >> yes. based on what they spent in 2010 on the operation baghdad pups. >> in fact, according to these irs tax filings, spca international has taken in more than $26 million in donations over the past three years. $23 million of that money has gone right into the coffers of the direct mail company, quadriga art. and spca international is still in dead to quadriga art another $8.4 million. what's worse, the spca international admits they haven't rescued any military dogs, just 26 contractors dogs including ivy and nugget.

the bulk of the animals claims to have saved, a total of 477 have been strays befriended by the troops. $26 million to rescue less than 500 pets? how is that possible? that's what we wanted to ask the group's founder, pierre bernardi who lives in montreal. i'm wondering what you can tell us about the value of the donors. where is the money going? >> well, we have different programs. and the site covers it all. again, i have -- >> i have not seen any of that. >> i'm not trying to hide or avoid any questions. but we have a spokesman. she has all the answers ready for you. she has agreed to give you an interview. >> can you just tell us how? >> oh, absolutely. all you have to do is go on spcai.org. >> we did that and asked bob, the president of the charity watchdog group, guide star, about the documents we found. >> what worries me about this

one is that the numbers don't compute. i can't understand how to connect the dots between how much money is spent on fundraising to how much money is spent on programming and what the sources of those revenues are. and i also can't really measure the impact of this organization. what difference are they really making? >> a spokesman for spca international told cnn by e-mail that, yes, although our investment is not being returned in the time frame we had projected, the investments will pay for themselves within just a few more years. peggy admits it is successful for quadriga art and perhaps even spca international but the vets and their pets and anyone who gave money, she says, were duped. >> what is frustrating is that it's millions and millions of dollars that just go to a business, a for-profit business. it's not going to charity at all. >> drew griffin joins us. you weren't able to track down

this woman, terri crisp. she brought those dogs into the hln studios. where is she? >> anderson, we're told she's in thailand and supposedly that makes her unavailable. but there's something else we learned after digging into terri crisp and her background. she's done this before. after hurricane katrina, she staged media campaigns asking for donations to save pets stranded by that storm. and she actually collected $8 million for this charity called noah's wish. guess what? the state of california where that noah's wish was registered, they began investigating to see if any of the $8 million actually saved any katrina pets. the investigation ended with a settlement. the agreement was noah's wish return half the money, $4 million, and made a promise that terri crisp would not be a director, officer of any

charity. and they are now seeing if she violated that agreement. >> i remember this woman after katrina. we did a profile of her on our program. she told us she was saving thousands of dogs. is there any evidence that she saved any? >> according to the state of california attorney general's office that settlement agreement only finds that some money went to program services. and specifically, anderson, overhead. there's nothing that says even a single pet was saved from hurricane katrina. and now this woman's going around again telling us we need to give her money to save stray animals in iraq and afghanistan. >> again, if these people were on the up and up, they would want to clear their names and come for an interview. they're claiming she's in thailand and unavailable. i told you this before, i've lived in thailand. there's plenty of phones. they have internet connections. quite good ones. she could reach out. try to answer some questions. it's absurd, drew. appreciate you staying on it. amazing reporting. >> up next, after what drew has

been reporting, chances are you're wondering how can you be sure a charity is doing the right thing with your donations? we're going to get tips from two leader who is track charities. dad, i think he's dead. probably just playin' possum. sfx: possum hisses there he is. there's an easier way to save. geico. fifteen minutes could save you fifteen percent or more on car insurance.

with odor free aspercreme. powerful medicine relieves pain fast, with no odor. so all you notice is relief. aspercreme. all this hour we've been looking at charities promising to do one thing with your money and doing another, from veterans to animal charities, promises are not being kept. the bad deeds of few should not stop you from donating money to those that do a good job with their charities. we want to get tips on how to make sure you're working with a good charity.

art taylor is with wise giving alliance, and bob works at guide star usa, an organization that provides information on nearly two million nonprofits. are there quick and easy ways to check up on a charity? >> sure. the first way is to go to a good information source. go to give.org that evaluates 10,000 charities in relation to about 20 best practices that we believe charities should adhere to. >> things like transparency? >> things like how they're governed, how they manage their finances, how many board members are actually attending meetings, how truthful are they in their public information materials. >> and, bob, you say that you should be able to pick up a phone and call any charity out there that is soliciting money. what basic questions should someone be asking before deciding to donate? >> three simple questions. what does your organization do? tell us in very simple and easy to understand language, what do you do? how do you do it is a second question. in other words, what are your

programs? what are your activities? and then, three, how are you doing? give us some measurable way to measure the impact of your organization. >> art, have you heard about charities that use these fund-raising companies? that seems to be the common link, they're stuck in a contract, maybe they didn't realize what the terms of it were. but they are giving all the millions they've raised to this company and they're still in the hol hole. >> you know, fund-raising companies can be a good asset for some charities. but it's really important that management and the board take control of the situation, as bob said. they should really make sure they know what they are getting into. there are fees, of course, associated with using those firms, and that's fine. but the vast majority of the money should go to the charity, not to those firms. some charities that don't have household names will get a pitch from a fund-raising company,

which will say to them you don't have to do anything. we're going to bring you money. well, they will bring you a little bit of money but you're really going to upset your donors because in the end most of that money is going to stay with the fundraising company under an arrangement like that. >> bob, the other thing to me that raises red flags is that you would think that after all these reports we've been doing, naming specific people and specific charities, that if they were on the up and up and they wanted to clarify things, they know where we are. we have an open invitation to any of these folks to come on the program to talk, talk to drew griffin, yet there's not -- they're not. it's like they are all running for cover and stuff. transparency is incredibly important, isn't it? >> transparency is the first rule of a successful donation to a charity. you want to know how are you using my hard-earned dollars? can you prove to me, charity, that you're being effective, that you're being efficient, that you're really making a difference? and i think it's something we

expect today in today's charity world that every organization needs to be transparent and they need to be accountable. >> art, are there any ways for somebody to go back and see if their money is having a direct impact? >> well, you can ask the charity for a report on how they are doing. and we require that charities that meet our standards do that. they shod have an annual report that discloses how funds were spent, that talks about how they performed in relation to their admission, that talks about what their plans are for the future. these are things that every donor should be able to get from every charity. and so we think that, yes, every organization ought to provide that if a donor asks. >> art, thank you very much. appreciate all that you do. bob as well, thanks. we'll be right back.