Your Money: Honor veterans by helping legitimate charities

— -- There are many ways we honor members of the armed services. We rise and applaud them at sporting events, wiping our eyes at the sight of muscular young men with prosthetic legs. We hang banners from overpasses, welcoming home local men and women who have served in Iraq and Afghanistan. We attach "Support Our Troops" stickers to our cars.

While symbolic measures are no doubt appreciated, veterans need much more than a standing ovation and a pat on the back. Many are suffering from traumatic physical and emotional wounds. Civilian jobs are scarce. More than 135,000 veterans are homeless.

There are dozens of charities that claim to help veterans. You've probably received a phone call from some of them, or been solicited for donations at the grocery store. Sadly, though, the track record for veterans' charities is poor, charity watchdogs say, for two reasons:

•Veterans organizations, along with groups that solicit funds for firefighters and police officers, are magnets for hucksters and thieves.

For example, a man who identified himself as Lt. Cmdr. Bobby Thompson raised millions of dollars and cozied up to some well-placed politicians by creating a sham charity called the U.S. Navy Veterans Association. An investigation by the St. Petersburg Times found that the charity reported income of more than $100 million since 2002. The group's founder, who never served in the military and apparently stole someone's identity, has been indicted, but his whereabouts are unknown.

Crooks gravitate to veterans charities because they're lucrative, says Ken Berger, chief executive of Charity Navigator, a charity watchdog. Helping veterans "is a very powerful mission that pulls at many people's heartstrings," he says. "They see a big bucket of money to rip off."

•A large percentage of donors' funds go to telemarketers and professional fundraisers.

Many well-meaning founders of veterans groups don't have the time or expertise to run a charity, so they hire telemarketers and professional fundraisers, Berger says. Too often, he says, they turn a blind eye to the amount of money the professionals keep for themselves.

Some large veterans charities spend up to 90% of donors' contributions on fundraising, says Daniel Borochoff, president of CharityWatch (formerly the American Institute of Philanthropy).

Borochoff's research into the high cost of fundraising by veterans charities led to congressional hearings in 2007. Borochoff told Congress that 75% of the veterans charities he analyzed received a "D" or "F" rating, vs. 22% of all charities.

Since then, the situation has gotten worse, Borochoff says. "It's a national disgrace that hundreds of millions of donations intended for veterans are being wasted on massive direct-mail campaigns and gimmicks such as unordered greeting cards."

With Veterans Day approaching, the solicitations are likely to increase. Tips for donors:

•Don't respond to phone solicitations unless you already have a relationship with the charity, Borochoff says. Those calls are typically made by fundraisers, which means only a fraction of your contribution will go to veterans programs.

•Don't give money to people who solicit for contributions outside retail stores or on the street, even if they're wearing a military uniform. There's no way of knowing whether the money is going to vets — or even if the individual asking for funds is really a veteran, Borochoff says.