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? 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