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updated: 11/7/2017 2:22 PM

Illinois nonprofit to dissolve to settle fraud lawsuit

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ROCKFORD, Ill. -- The Illinois attorney general has announced a settlement by the state and more than 20 other states in a lawsuit accusing a Rockford-based veterans nonprofit of scamming donations.

Attorney General Lisa Madigan sued VietNow National Headquarters after an investigation found the nonprofit had raised more than $20 million between 2003 and 2014, but spent 80 percent of those donations on payments to for-profit telemarketers, the Rockford Register Star reported. Most of the remaining funds went to administrative expenses, leaving little for the program to help veterans, according to the newspaper investigation.

Madigan agreed to an order Monday that dissolves the agency's board of directors and bans its four controlling officers from any fundraising, charity management or oversight of any charitable assets in Illinois. The nonprofit's assets will be split between two legitimate organizations that assist Vietnam veterans.

"For years VietNow has scammed donations from people who thought their money would be used to support necessary services for our military veterans," Madigan said. "Instead, VietNow pocketed donations and did virtually nothing for veterans. Today's settlement finally will put an end to VietNow's egregious fraud."

The 23 other states investigating VietNow will enter into a state-specific settlement agreement with the nonprofit that's similar to those in the Illinois order.

"It's a little frustrating because we're separate from the national VietNow organization," said Darrell Gilgan, treasurer of the Rockford VietNow chapter. "We'll continue on, and all of the local chapters will continue on."

The Vietnow chapter in Rockford has about 300 members.

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Information from: Rockford Register Star, http://www.rrstar.com

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