Wounded Warrior Project Denies Claims of Waste, Lavish Spending

A Wounded Warrior Project flag is hoisted on a bicycle during a 25-mile soldier ride in Germany on Aug. 3, 2012. Brooks Fletcher/U.S. Army
A Wounded Warrior Project flag is hoisted on a bicycle during a 25-mile soldier ride in Germany on Aug. 3, 2012. Brooks Fletcher/U.S. Army

WASHINGTON -- Under fire for questionable use of donations, the Wounded Warrior Project on Wednesday denied allegations that it spends too little on injured troops while paying for resorts, parties and alcohol.

In its most recent tax filing, the group far outpaced other charities in fundraising in 2014. It spent a whopping $149 million on direct care for wounded troops, while other large national charities have entire budgets worth tens of millions.

But the massive success came with a hefty price tag. According to 2014 tax records, the Wounded Warrior Project spent 34 percent of its total expenses on fundraising while only doling out 60 percent for direct care.

For an investigation that aired this week, CBS News interviewed former employees who said that the charity wasted money on lavish staff perks including travel, conferences, hotels and dinners, and that CEO Steve Nardizzi used extravagant ways to enter those events, such as rappelling, riding a Segway and on horseback. One four-day conference in Colorado for its 500 staff members reportedly cost $3 million, according to CBS News.

On Wednesday, the nonprofit fired back in a letter posted online. The nation's largest military charity said 80 cents of every dollar it spends now goes directly to those in need and demanded CBS News retract its stories on the group's spending.

"Based on our most recent independently audited financial statements, 80.6 percent of total expenditures went to provide programs and services for wounded service members, their caregivers, and families," wrote Ayla Tezel, executive vice president of communications for the Wounded Warrior Project.

Tezel also denied that the nonprofit spent $26 million on staff get-togethers, including the $3 million training event.

"Ninety-four percent of the figure CBS reported as conference and meetings for staff was actually a program expense for warriors and their families to participate in services such as mental health programming," Tezel wrote.

Tezel did not return requests for comment from Stars and Stripes. No new financial statements have been released.

Other top-rated national charities such as the Fisher House Foundation and Operation Homefront put only a small percentage of their total expenses into fundraising, while spending about 90 percent on direct care. If the Wounded Warrior Project had managed its money along those lines, it could have spent an additional $75 million in 2014 on direct aid, according to tax documents published by the website Charity Navigator.

The allegations by people who used to work for the Wounded Warrior Project -- which the charity called a "handful of former, disgruntled employees" -- and the low spending on direct care was a blow to the group's image.

It raised questions over how it manages and spends money that many donors believe will go directly to helping wounded service members, said Joe Kasper, chief of staff for California Republican Congressman Duncan Hunter, a Marine veteran.

"The scrutiny is definitely fair, and it's on WWP to prove to its donor base and prospective donors that it strives to reduce operating costs and overhead in order to help even veterans -- otherwise, WWP is going to continue hurting itself and its image," Kasper wrote in an email to Stars and Stripes.

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