Conservatives soliciting elderly use fear tactics

November 12, 1992|By Erik Eckholm | Erik Eckholm,New York Times News Service

"All the Social Security Trust Fund Money Is Gone!" screamed the official-looking envelope received by millions of elderly Americans earlier this year.

The letter inside called for emergency action to halt "the enormous fraud that has taken place at your expense" and asked for $5 in membership dues, and an extra $5 or $10 or $15, so the United Seniors Association could keep on "fighting hard in the nation's capital to insure the rights and benefits of America's seniors are protected."

It is the minimalist approach to public advocacy. United Seniors, to which hundreds of thousands of retirees have contributed millions of dollars over the last year, has no lobbyist, and its directors are experts in fund-raising, not in the problems of the elderly.

Nearly all its proceeds are used to send out more letters seeking more donors, usually with language critics describe as misleading and frightening.

That letter was signed by George L. Murphy, former Republican senator from California and, until his death in May, honorary chairman of United Seniors, a new non-profit, tax-exempt advocacy group.

As those who sent money learned from the strident solicitations they have received monthly ever since, the actual chairman of this seeming bulwark of Social Security and Medicare, the largest federal benefit programs, is arch-conservative Richard A. Viguerie.

A leader of the New Right movement that helped put Ronald Reagan in the White House and has clamored for a balanced federal budget, Mr. Viguerie remains a familiar source of stinging commentary. He is best known as a pioneer and master of direct-mail fund-raising, which he says he devotes to the conservative cause.

But a detailed examination of Mr. Viguerie's recent turn to the elderly for money shows him to be a master, above all, at generating new revenue for his cash-starved personal business, now called Viguerie & Associates.

Since 1989, in a pattern that experts in philanthropy say raises serious questions about Mr. Viguerie's motives, he has either created or worked for at least four advocacy groups that have bombarded the elderly with tens of millions of solicitations, generating millions of dollars in fees for his private companies.

Twice, he set up his own groups that competed with the organizations that bought his direct-mail services, possibly undermining his clients by soliciting many of the same retirees on exactly the same issues.

Mr. Viguerie did not respond to numerous requests over a two-month period for comment, including messages left with members of his staff by telephone and in person noting that his business practices were under criticism.

In his advocacy for the elderly, Mr. Viguerie appears to have followed the letter if not the spirit of the generally lax federal and state laws covering tax-exempt advocacy groups, which, according to Internal Revenue Service regulations, must be dedicated to a social purpose.

Devoting most resources to mailing, for example, is legal because the IRS allows advocacy groups to count the messages in their letters as public education.

But Mr. Viguerie's new dedication to helping the elderly appears to have been pursued in a manner filled with potential conflicts of interest, in operations that seem, above all, to generate money for his indebted private enterprises.

Some call it fright mail

Mr. Viguerie's organizations use nearly all of the donations they receive to send out still more letters and, in the process, spread large sums among list-renters, letter-writers, printers, mailers and other subcontractors, always including Mr. Viguerie himself.

In the case of United Seniors, Mr. Viguerie founded and directs an organization that takes advantage of the large postal subsidies available to tax-exempt groups to send what critics in Congress call fright mail.

The group, in turn, spends hundreds of thousands of dollars a year to rent the mailing lists that his for-profit company compiles and maintains.

xTC "It's a sweetheart deal," said Kenneth Albrecht, president of the National Charities Information Bureau, a watchdog group in New York. "He is using a non-profit to make money for his own company."

Mr. Viguerie's activities show how easily charities and fund-raisers can tap popular passions and public subsidies for private gain by subtly manipulating the fund-raising operations in ways that are difficult for donors or government regulators to detect.

The examination of his activities, which included review of dozens of financial documents and contracts and records of lawsuits as well as interviews with numerous current and former employees, has also provided an unusually detailed portrait of the fund-raising tactics followed by Mr. Viguerie and several proteges, who make up a significant subsector of the fund-raising industry.

Warnings and solicitations

Many direct-mail companies subscribe to a code of ethics that prohibits many of Mr. Viguerie's practices.

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