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Military Order of the Purple Heart
Service Foundation, Inc.
P.O. Box 49
Annandale, Virginia 22003
703-256-6139 Fax (703) 256-6142
TO: Patriots and Ladies of the Military Order of the Purple Heart
of the U.S.A., Inc.
FROM: Richard H. Esau, Jr., Executive Director
SUBJECT: MOPH National Commander Cook's 9 January 2008 Letter
DATE: January 18, 2008
Henry Cook sent a four page letter to the MOPH "Chapter and Department Commanders" on 9 January 2008. This correspondence takes exception to just about everything contained in that letter for reasons enumerated below. This reclama takes a paragraph by paragraph approach. Henry Cook's original statements have been italicized for clarity.
The MOPH is in a crisis! Because of that I am reaching out to every Chapter and Department Commander to tell you of the crisis so you can tell our members. You often either don't get the word or information is stifled by negative comments or rumor. I would like to think of this communication as a means of having a personal chat with each and every one of you. My desire is that this communication will be informative, educational, and that it will enlighten our membership as to the crisis that confronts us all.
Para 1: The MOPH is not in crisis and more than sufficient funds are available for the Order to carry out its mission. If anyone is guilty of negative comments and rumor, it is Henry Cook and certain members of his staff. The only crisis that seems to exist is the one that has been created by the Commander. The negative comments and half truths that he mentions are those that he has elected to disseminate.
The Military Order of the Purple Heart Service Foundation (MOPHSF) has been in existence for some fifty years, and it's genesis was borne out of the need to remove the burden of fundraising off of the backs of the MOPH (the Order) so that they might expend all of their efforts toward outreach to our Purple Heart membership, and other Veterans' causes. Throughout the years the mission statement and policies of the fundraising arm, MOPHSF, changed as the demands for funding increased due to a significantly greater population of Purple Heart recipients from Korea and Vietnam, and the Order's mandate to provide accredited service officers to those Veterans through the Veterans Administration.
As stated within the MOPHSF's Amended & Restated Bylaws the purpose of their existence shall be to provide Service, Welfare, and Rehabilitation of the wounded, disabled and handicapped Veteran, to include his/her surviving spouse, orphans and fellow Veterans. It also is stated that the purpose of the Service Foundation is to promote employment opportunities for such persons and to engage the public about Veterans' affairs and issues of importance to Veterans, and otherwise to assist those who have sacrificed so much for our Country.
Paras 2 & 3: These paragraphs are a fair representation of the MOPHSF's 50-year history of support to the MOPH and other Service Organizations.
At this year's Foundation Convention, held at the Embassy Suites Hotel in Lake Buena Vista, Florida, the Foundation's Executive Board members presented a resolution that if it had passed would have removed the vote of the Current National Commander in matters concerning the Foundation's funding of the Order. It also wanted to prevent the MOPH National Commander from being granted a seat on the Foundation at the end of his command tour. It must be noted that this is the very method that the sitting members obtained a seat on the board but now they want to stop that practice.
Para 4: This paragraph indicates a lack of understanding re when the Commander was given a Foundation vote in the first place and why the By Laws were changed to facilitate a Commanders' acceptance as a Board member. Until early 2000, the Commander did not have a vote on the Foundation Board and his acceptance to the Board was subject to a Foundation vote. In an attempt to bring the Board and MOPH leadership closer together, the By Laws were changed and the Commander was given a vote and entry to the Board by simply requesting a seat.
Over the last several years the regulatory landscape has shifted and, laws have been passed so that Congress and the IRS can more closely regulate the business of non-profit entities. Sarbanes-Oxley, in the for profit sector, regulates among other things, conflict of interest issues and governance of corporate entities. By extension, these regulations through other laws and regulations are requiring Sarbanes-Oxley like compliance in the non-profit areas. The Foundation is mindful of its responsibility to maintain its tax exempt status as a non profit organization has attempted to avoid these conflict areas and require admission to the Board as a matter of acceptance rather than mere passage. Bylaw changes requiring a vote to be on the Board is consistent with the spirit and intent of these new types of regulatory requirements. The voting on issues that impact on funding for the Order of which the Commander is the recipient of these funds is clearly a conflict of interest to be avoided. These resolutions Patriot Cook refers to have nothing to do with him personally, it is simply an attempt by the Board to avoid criticism and possible sanctions for non-compliance.
Prior to Veterans' Day weekend, ABC's investigative report team, led by Emmy winner Brian Ross of 20/20 fame, used the MOPH website photo of me with a big "F" prominently stamped across my face as if the words spoken inferred mis-appropriation and wrong-doing on my behalf and the MOPH! I knew that the story they were attempting to tell was really about the Foundation and that they had simply mis-identified the real individuals who were responsible for the "F" report card. I admit that I was stunned and embarrassed. My family began calling and wondering what I had done to warrant such shame. I was sure that the Executive Director and the spokesperson responsible for the Public Relations work at the Foundation would come forward and straighten this entire dilemma out. I asked them to do just that. That was two months ago, and still to this date no one from the Foundation has come forward with the facts to answer our critics. I could no longer stand by and wait for the event that might never take place. So, with the National Adjutant, I accepted the invitation to appear before the Nation and face our accusers. I invited the Executive Director of the Foundation to accompany me, but he declined. I was warned not to go by the Executive Director of the Foundation and his Executive Advisor. They both told me that the press would twist whatever I said and destroy the Order and the Foundation. But I have faced insurmountable odds before in my life. Thirty-three years as a Special Forces Soldier inculcated within my very fiber, the ability to overcome, the ability to set the record straight.
Para 5: The "real" reason for Patriot Cook's refusal to work with the Foundation and his own leadership is contained in this paragraph. The Foundation is sorry that ABC News used a photo of Patriot Cook to highlight the unjustified "F" grade given to the MOPHSF and numerous other Service Organizations. For a start, the data used to determine how much of the monies the MOPHSF receives are used to support our programs was incorrect. Therefore, the percentages are way off. Second, the Foundation immediately called ABC and notified them that Dick Esau and not Henry Cook is the Executive Director of the MOPHSF. We also asked for a retraction and placed his picture alongside mine in the website, identifying the position of each. Cook's statement that "to this date no one from the Foundation would come forward to straighten this entire dilemma out" is patently false. The only way Henry considered straightening the situation out was for the Foundation to appear on ABC news so that the "real individuals who were responsible for the "F" report card" could be identified and Henry absolved on camera. From the beginning, the Foundation thought our appearance on ABC News was a bad idea and we so advised Patriot Cook. The Foundation retains this position as Patriot Cook's taped interview with ABC aired solely for the edification of Patriot Cook. His statement re his "thirty three years as a Special Forces soldier inculcated within my very fiber the ability to overcome, the ability to set the record straight" is self-serving to say the least.
The interview was held in the studio complex of ABC's New York City Headquarters. For 90 minutes, on camera, my Adjutant and I answered, directly and without hesitation, all questions put to us regarding the behavior of the Military Order of the Purple Heart. Some very pertinent and tough questions were asked of us both. I am proud of our answers because they were direct truthful responses without manipulation or spin. Do we have knowledge of what the Foundation does behind doors in their executive sessions? Did we divulge secretive information? Did we rat out our fellow Patriots and Brothers? The answer to these questions is an emphatic and resounding, "No." Nor did we attempt to "spin" or qualify our answers. Direct and truthful was our mantra and we stuck to it.
Para 6: This paragraph relates to the interview at ABC and how Patriots Cook and Palagyi answered all questions directly and without hesitation. Cook allows that many questions were "pertinent and tough" but he's proud of the answers he and Palagyi gave. He then goes on to pat himself on the back for his mantra of truth in responding to questions. Those who saw the ABC presentation now know that Patriot Cook's purpose in giving the interview was to make himself look like Saint George at the expense of the Foundation and one of his own elected Officers. In an attempt to prepare for participation in the interview process, the Foundation requested that Commander Cook provide the questions and the responses he provided ABC News. Unfortunately, Commander Cook did not see the benefit of doing so. Being left unprepared, the Foundation, following Commander Cook's refusal, declined to participate in the interview process.
Within the framework and Constitution of our Charter and Bylaws, it is stated that there shall be no closed session. We must and do account for every penny that is taken in and expensed. We are as transparent as glass because all of our expenditures are vetted out within the budget process.
Para 7: Patriot Cook brags about how open and above board the Order is. If he can account for every penny "taken in and expended," why then is he refusing to provide a copy of the prerequisite audit which was due to the Foundation in last summer? In order to be compliant, the Foundation has required that the recipient of funds verify through an audit process that the funds they received were properly expended as represented in their initial request. The Order's refusal to deliver an audit more than six months after the close of its fiscal year is highly irresponsible and wholly unacceptable. The same requirement that the Order places on its subordinate departments is the same type of requirement that the Foundation requires the Order to meet.
For the first time in the history of the Order, we have been denied funds to support our programs. The Foundation has cut our budget! The NEC approved our budget and the Foundation cut it, which amounts to a line item veto. The NEC ballot called for the funding to be set at $2,266,690. The Foundation minutes state, "The unrestricted grants from the Foundation to the MOPH National Organization for the fiscal year 2007-2008 shall not exceed $2,000,000."
Para 8: This paragraph once again highlights Patriot Cook's lack of knowledge regarding the relationship between the Foundation and the Order. During most years of our history, it was not fiscally responsible for the Foundation to honor the entire grant request from the Order. 2007/2008 is going to be one of those years. The money available for the Service Programs is $5,900,000 or $700,000 more than was spent last year. The $2,000,000 available for HQs operations is the figure the Adjutant said he needed to operate. If the Foundation had authorized the $6,900,000 initially requested and discussed with the National Service Director for the Service Program and $2,266,690 initially requested and discussed with the National Adjutant for the HQs operation, the Foundation would show a negative $600,000 for the year. All Patriots should understand that the costs associated with supporting MOPH programs have increased from $5,835,781 to $8,798,074 (an increase of $2.96 million or by 51%) in the last four years. Patriots should also understand that the "NEC approved budget" is not a budget at all but approval of the "grant request" the MOPH sends to the Foundation. Last year the MOPH did not use $900,000 of the approved grant which meant these monies were frozen and not available for investment. The failure to invest these sums only places a further increased burden on the fundraising efforts. These efforts are currently being stretched to the limits and the charitable contributions in this economy are shrinking not expanding. Know this, the Foundation knows what its doing, and the money made available to the MOPH is sufficient for the Commander to carry out his mission.
Patriot Cook's appearance on Good Morning America and his unfounded attack on the Foundation most certainly will not help our fundraising efforts.
As the National Commander, and the one responsible for the programs associated with the grant request, I find it careless and irresponsible that the Service Foundation deem it necessary to reduce the monies needed to carry out our important mission in lieu of some of the monies and circumstance surrounding the expenses of the other programs financially supported by the Service Foundation.
Para 9: Cook's argument in this paragraph is not to be credited and once again indicates a total lack of understanding of how the finances of the Foundation and Order are conducted. Perhaps the fact that Patriot Cook has been a member of the MOPH for less than six years might offer an explanation. The Service Foundation has and will continue to assess funding needs against current and projected revenue and on going and growing fundraising expenses. Contrary to Commander Cook's belief, the Foundation does not have unlimited resources and is in competition with other charities for the donor's contribution.
Never before has the Order been faced with such a crisis. The Foundation is attempting to take total control of the Order by micro-managing our budget and telling us what we can do and what we cannot do. We must take a stand. Do we need the Foundation to continue service to the Veterans? We could raise our own funds and control our own destiny without being managed by an outside agency.
Para 10: Once again Patriot Cook is not to be believed. The Order is not yet faced with a crisis. The Order is funded as indicated in paragraph 8 above and is on firm ground and the Foundation is functioning well. Assuming Patriot Cook's appearance on ABC does not adversely affect the donation/revenue stream, the Foundation's financial support of the Order will continue as necessary.
In closing, it is my opinion that we are hanging Cliffside with the earth crumbling before our very feet. This is the time for all Patriots to come to the aid of the Order, and to stand up and be heard and ask the hard questions.
Para 11: Just another case of Patriot Cook being his alarmist self. The Order is not hanging off a cliff with the world crumbling before its very feet. Hopefully, the days of ready, fire, aim are now behind us and we can get on with the business of looking after the troops!
Para 12: Paragraph 12 is a list of questions Patriot Cook, or perhaps it is Patriot Funderburk, has provided for the memberships' consumption.
1. The gifts to the "museums" of 500K each were for the Hall of Heroes and the Purple Heart Hall of Honor (PHHH). The Hall of Heroes, aboard the Intrepid, is where the record of Patriots and how they were wounded will be available to their families in perpetuity. The Purple Heart Hall of Honor 500K gift was for its construction at Washington's Revolutionary War Cantonment in Vails Gate, New York where the Continental Army was at war's end. The PHHH honors all who received a Purple Heart and ultimately will provide a thumbnail sketch of how our fellow Patriots received the award. The PHHH, like the Intrepid, is set up to video tape Patriots so that their great, great, grandchildren will be able to see their great, great, grandfather/mother and hear them explain how they were wounded. The Foundation also provided a grant of roughly $400,000 to Commander Cook in support of Purple Heart members affected by Hurricane Katrina that he somehow forgot to mention.
2. Are so many meetings necessary? Are those costs associated with the meetings essential to Veterans causes? The Foundation has apparently spent more than $400,000 on travel to meetings.
2. The Foundation did not spend $400,000 just for travel to meetings and the money expended included a joint meeting of the Foundation and the Officers of the MOPH as designated by the Commander, accommodations and per diem as well as travel. Remember this past year was a year of transition. The Board had to pick a new Executive Director, choose a new outside Auditor firm and create a new Audit and Investment Committee to name a few.
3. Does conflict of interest exist within the Foundation? Is it proper for a MOPH National Officer to also serve on the board of the Foundation?
3. This comment is akin to asking if a National Officer can be a non-elected member of the Department of the state from which he hails. Elected positions on the Foundation can not be held by elected members of the Order. It's strange that Patriot Cook would surface this concern when he feels no conflict exists with him having a vote on the Foundation Board and the Adjutant who controls the MOPH budget also has a seat as a nonvoting ex-officio member.
4. Have Officers used their influence for their own gain?
5. Should we allow the Foundation to control our programs?
6. Should the Executive Director make personnel demands on the Order?
7. Does the Foundation's PR policy need to be revamped?
8. Should the Foundation have 6 figure payroll salaries?
9. Should we continue with the Foundation?
10. Should the Foundation be forced to dissolve?
9 & 10. With the missteps cited, we are all fortunate that separate bylaws and constitutions do not allow the present Commander to control the Foundation. The Foundation is a separate organization and any move to dissolve it will come from the Foundation itself. For those of us who have been around for 25 years or more, we know the Foundation/Order relationship is solid and will continue long after Patriot Cook has moved off into the sunset.
Richard H. Esau, Jr., Executive Director