Embattled veterans political committee abruptly shuts down

Introduction

A Virginia-based political action committee has closed down while under scrutiny for raising millions of dollars in the name of military veterans — but spending almost all of the money on telemarketing, salaries and overhead.

Put Vets First! PAC and two sister nonprofits run by retired Army Maj. Brian Arthur Hampton were the focus of a Center for Public Integrity investigation in late 2017 that prompted attorneys general in New York and Virginia to investigate Hampton’s operations. 

During the past four years, Hampton personally earned hundreds of thousands of dollars from his operations while telemarketers he hired earned millions, according to federal records.

Hampton’s Put Vets First! PAC filed a termination report with the Federal Election Commission on Saturday. The PAC’s website has been taken down, as have the websites of the two sister nonprofits.

A Center for Public Integrity reporter visited the longtime Falls Church, Virginia-based headquarters of Hampton’s three organizations in June. The doors were locked. Darkened, empty offices were visible through the mail slot. A representative at the office building’s leasing office on the first floor said Hampton had moved out two months prior and did not leave a forwarding address.

It is unclear whether Hampton or a representative has filed paperwork with the Internal Revenue Service to also terminate his two nonprofit operations — the Center for American Homeless Veterans and the Circle of Friends for American Veterans. Both were still listed as active on the Internal Revenue Service’s nonprofit locator on Sunday.

Hampton did not return a phone call on his personal number, an email or a request for comment left at his Arlington, Virginia residence. His headquarters phone line has been disconnected. His longtime employee, Alexandria, Virginia, resident Elizabeth Heaps, also did not return requests for comment left at her residence and sent via Facebook’s Messenger app.

William Constantine, an Oakton, Virginia-based accountant who became the point of contact for Hampton’s PAC in recent months, declined in June via phone to answer any questions about the PAC or Hampton. He did not respond to emailed questions.

The New York Attorney General’s office declined to comment, noting the investigation it opened into one of Hampton’s nonprofits — the Center for American Homeless Veterans — is ongoing.

The Virginia Attorney General’s Office did not respond to multiple requests for comment.

Meanwhile, James C. Edgar, a former Hampton employee, last year filed a whistleblower complaint with the IRS against Hampton’s two nonprofits after he left the groups. But Edgar said the IRS informed him last fall that Hampton’s tax returns had been filed correctly from an accounting perspective. 

If he wanted to pursue further action alleging misuse of donations, the IRS wrote, he would need to reach out to a different department. Edgar dropped the matter.

Big PAC money

Hampton formed Put Vets First! PAC in 2010, but it didn’t raise or spend much money its first several years. 

He started contracting with Outreach Calling, a controversial telemarketer, in October 2015. That’s when the PAC started reporting significant contributions and expenses.

Over its life, the PAC alone raised more than $4.8 million. Telemarketers kept $4.4 million of that, and Hampton earned about $183,500, according to Federal Election Commission disclosures. Most of the rest went to pay the PAC’s other employees and consultants, bank and legal fees and rent.

In all, the PAC gave $15,000 — or 0.3 percent of the money it raised — to political campaigns and committees. The beneficiaries include former Sen. Dean Heller, R-Nev.; Rep. Steve Knight, R-Calif.; and several other candidates seeking elected federal office.

After being informed of Hampton’s activities, five recipients of Put Vets First! PAC’s contributions confirmed to the Center for Public Integrity they would either give away or return the money.

Hampton’s most personally lucrative period running his veterans operations came in 2016 and 2017. 

From Oct. 1, 2016 to Sept. 30, 2017, Hampton earned $469,627 combined from Circle of Friends for American Veterans, the Center for American Homeless Veterans and Put Vets First! PAC, according to the latest federal tax returns he filed and calculations from Federal Election Commission filings.

Out of $6.5 million spent in that same time period by his three organizations, telemarketers received $5.7 million. Almost all of the rest paid for salaries and overhead.

When the Center for Public Integrity first contacted Hampton in 2017, he defended his use of telemarketers, who were keeping about 90 percent of what they raised for Hampton’s three organizations.

“Over the course of 24 years, I have tried every other fundraising technique known to me in over four decades with fundraising experience, most of them over and over again, with different variations,” Hampton said in an email to the Center for Public Integrity. “None of those efforts produced revenue remotely close to the revenue generated by telemarketing.”

He also defended his compensation: “I am the head of three organizations. I am always working.”

He reported on federal tax returns working 70 hours a week between the Circle of Friends for American Veterans and the Center for American Homeless Veterans in 2017.

Hampton: Then and now

Hampton enlisted in the U.S. Army in 1968, served a year in Vietnam in “psychological operations” during the war and was in the Army Reserves from 1970 to 1992, according to a biography he provided the Center for Public Integrity and personnel records from the Army and the National Archive. He retired with the rank of major.

It was 1993 when Hampton — “steamed” that the government was leaving veterans behind, in his opinion — said he co-founded Circle of Friends for American Veterans, a 501(c)(3) nonprofit charity, out of a bedroom in a small co-op apartment in Virginia. 

He later formed the Center for American Homeless Veterans, a 501(c)(4) “social welfare” nonprofit, which operated from the same office as Circle of Friends for American Veterans.

The nonprofits’ early years proved rocky. Hampton said he and his business partners initially tried to raise funds themselves, but it was grueling, inefficient work. They tried to run a donation call center on their own, too, but they decided that also wasn’t worth the effort.

When they turned to telemarketers, they found they had more time to dedicate to charitable work, Hampton said in 2017, before he stopped responding to questions.

His charitable work initially involved running a transitional shelter for homeless veterans in northeast Washington, D.C., and later he conducted rallies around the country. But he ultimately decided both efforts were too expensive and took up too much time.

In later years, once the telemarketers started pulling in millions from Americans who wanted to help veterans, Hampton shifted to making phone calls to communicate the needs of veterans to politicians and donors.

“There is no group that I know of that does what we do, educate and advocate for 21 million American Veterans,” he wrote.

Charity watchdogs disagreed. After the Center for Public Integrity published its investigation into Hampton’s operations, Charity Navigator placed “concern advisories” on their website about Hampton’s nonprofits.

“We try to be a way for donors to gather all of the information they need when making a gift,” a Charity Navigator representative previously said. “If we put up an advisory, it’s because there’s something we’ve been made aware of that donors should look into before they make their donation.”

Charity watchdogs say the most effective nonprofits spend at least 75 percent of their expenses on program services and no more than 25 percent on fundraising and overhead. 

Hampton’s tax returns claim his nonprofits are spending just under one-third of their money on programs — but that’s only because telemarketers’ consulting fees are counted as “program” services. CharityWatch, a nonprofit that analyzes financial statements of charitable organizations, says Hampton’s nonprofits spend 7 to 11 percent on programs.

Hampton has left one clue about his next act: He appears to be planning to write and sell a book called “SAIGON WARRIORS, PSYOP In Vietnam, They Ran the War for Hearts & Minds.” 

In May, Hampton launched a new website touting his political connections and military service and invites people to subscribe to email updates about his forthcoming book.