TAMPA>> — Battered by news reports about its secret membership and mysterious finances, the U.S. Navy Veterans Association has been shut down or is under investigation across America.
Ohio joined the growing roster of states, including Hawaii, moving to shut down the charity, with the attorney general there calling the group "absolutely illegitimate from the get-go."
The man behind it all, Bobby C. Thompson, cleared out of his duplex in Ybor City last year after the St. Petersburg Times began asking questions about the Navy Veterans.
His whereabouts secret, Thompson continues the fight to keep his organization alive on two key fronts: keeping investigators away from the Navy Veterans’ records and finding ways to instill confidence in his charity to keep public donations rolling in.
The battle to keep the charity’s records secret is being waged in Hillsborough Circuit Court, where Navy Veterans attorneys are opposing Florida Attorney General Bill McCollum’s demand to produce a warehouse full of Navy Veterans records, from membership lists to bank names and vendor contracts.
The group has filed papers seeking to block 11 subpoenas by McCollum’s office. The Navy Veterans says its members must be afforded the same freedom of speech and assembly granted civil rights activists in a 1958 U.S. Supreme Court case that sided with the NAACP against the state of Alabama.
On the other front — restoring the charity’s credibility to keep donations flowing — Thompson has hired a law professor and expert on nonprofits at Florida A&M University College of Law in Orlando. The expert, Darryll K. Jones, has made a preliminary determination that he found no reason the Navy Veterans group "does not continue to be entitled to tax exemption" the IRS granted in 2002.
The website, www.navyveterans.org, already is touting Jones’ coming report, which was scheduled to be released last Tuesday. In a 90-minute interview with the Times, Jones said he is exercising extra caution because it’s likely Thompson will use his report as a seal of approval from a credible, independent expert.
”I’m not putting anything out there that’s going to make me look like a fool," Jones said.
Jones’ professional side says he can accept the less than $10,000 the Navy Veterans group is paying him and honestly report on narrow questions put to him about organizational structure.
But he said some of Thompson’s conditions have given him pause: Jones was not allowed to divulge whom he interviewed, what documents he examined or the secret location from which Thompson now runs the Navy Veterans operation.
”He’s not the easiest client to control," Jones said.
At one point, Jones asked Thompson why he did not simply produce the Navy Veterans directors and officers that no one has been able to find.
Thompson’s reply, according to Jones: "It’s because they’re scared to death of intimidation and harassment."
”He’s sort of a reactionary, tea party kind of guy," Jones said of Thompson. "He believes there’s a witch hunt going on and a campaign against his group for political purposes."
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In the late 1950s, the NAACP wanted to open an Alabama office, while the state wanted to keep the NAACP out.
The state attorney general sought the NAACP’s membership rolls. But the U.S. Supreme Court said surrendering its rosters would violate the NAACP members’ constitutional rights to free speech and assembly.
Now Helen Mac Murray and Gary Lee Printy, attorneys for the Navy Veterans, make the same argument in asking a judge to block McCollum’s subpoenas.
Disclosing that material might limit the group’s members freedom "to freely associate and advocate their beliefs because the subject of military support and/or involvement is highly contentious," court papers say.
The case was assigned to Hillsborough Circuit Judge James M. Barton. No hearing has been scheduled.
Lloyd H. Mayer, a Notre Dame Law School associate professor whose specialty is nonprofits, said Florida might come to regret demanding the group’s membership rosters.
”In seeking the names of rank-and-file members," he said, "the Florida attorney general may be guilty of over-reaching in this case, and it could result in drawing sympathy for this group."
As it happens, Mayer is an editor of the Nonprofit Law Prof Blog along with Jones, the law professor Thompson hired to review the Navy Veterans tax filings.
Jones said he knows both Mac Murray and Samuel Wright, a retired Navy captain recently re-signed as special counsel to the Navy Veterans.
A posting about the Navy Veterans investigation appeared on the Nonprofit Law Prof Blog in April recapping the Times’ questions about the group.
”What is perhaps most interesting is that the Association appears to have made its required federal and state filings, which formed the initial basis for the newspaper’s investigation," the blog posting reported. "It will be interesting to see if these filings were inaccurate and, if they were, if the Association and its leader(s) face any penalties as a result."
Jones said the Navy Veterans did not hire him to determine if data on tax papers was accurate. He said Thompson narrowly defined his task: See if Navy Veterans tax filings met IRS rules and if expenditures met the charity’s defined mission.
Jones studied tax papers filed by the Navy Veterans but said he was not asked to determine if the people who signed the tax returns are real. He reviewed the association’s expense receipts but said he could not vouch for their authenticity. He conducted "hours of interviews with key individuals" at the nonprofit but said Thompson made him promise he would not reveal with whom he spoke.
”It’s in his mind that he doesn’t want to divulge names because they will be subject to harassment," Jones said.
Of those interviewed, Jones said he was permitted only to identify Thompson and Karmika Rubin, a Tampa Bay area lawyer who was Thompson’s assistant and who Jones now says is a member of the Navy Veterans board.
The two people Jones said he was allowed to identify are not among the nine key officers shown on the Navy Veterans website.
Mayer said he had no problem with the hiring of Jones to perform the examination of the Navy Veterans organization.
”What I would question is not Darryll’s acceptance of this role," Mayer said, "but the failure of the organization and its board to hire investigators to look into the allegations raised."
In March the Times reported that it could find only one of 85 state and national officers the Navy Veterans named in IRS documents — Thompson — and that the group refused to disclose where 99 percent of its $22 million of revenue in 2008 went.
Jones, himself an Army veteran who served with the Judge Advocate General, said Thompson mishandled matters from the outset.
”I wouldn’t have advised him to pack up and leave when the questions started," he said. "I would have stayed and defended myself.
”But I have to acknowledge that Thompson is not your average guy."
Jones said that if the Navy Veterans takes his advice, "I’d expect there will be some tidying up to do with this nonprofit."
Ohio is the latest state to move against the U.S. Navy Veterans Association. Late this week, Ohio Attorney General Richard Cordray said the group’s state chapter appeared fictional and the "only living, breathing person" his investigators found was Bobby Thompson.
Regulators in at least seven states have opened investigations since late March, when the St. Petersburg Times published "Under the Radar." The stories questioned the Navy Veterans’ legitimacy and examined more than $180,000 in personal political contributions from Thompson, the nonprofit’s founder.
Also investigating are Virginia, New Mexico, Missouri, Oregon and Hawaii.
U.S. Sen. Jim Webb, a Virginia Democrat and former secretary of the Navy under President Ronald Reagan, has asked the IRS and the Department of Veterans Affairs to investigate the group.