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Allied Veterans' operations probed

Hernando Today
Published:   |   Updated: May 10, 2013 at 06:06 PM
SPRING HILL -

A spokesman for a regional sweepstakes business said his company has given most of its earnings to charity and denied it ever violated labor laws.

Allied Veterans of the World registered nearly a $56,000 loss in 2008, according to records filed with the Florida Department of Agriculture and Consumer Affairs. In spite of those numbers, a company attorney and executive claimed it generated enough revenue during the past few years to donate more than $5 million to charities and ROTC scholarships.

After rent, expenses and prize money are paid, more than 80 percent of the company's proceeds go to charity, said attorney Kelly Mathis.
"What we do is completely compliant with Florida law," he said.

Mathis also confirmed reports that former National Commander Johnny Duncan received a salary of $345,000 in 2008.
"As National Commander, he spent untold hours, probably over 70 a week, working for Allied Veterans," Mathis said. "He also informed me that he logged over 130,000 miles on the road in connection with his role."

His salary was "determined by comparative salaries and discussed and voted on by the committee," according to state records.
Allied Veterans reported 38 operating sweepstakes rooms in its most recent filing with the state, including two in Spring Hill.
Those locations are owned by Anthony Alascia, records show.

Messages left with Alascia at the Allied Veterans location at 7269 Forest Oaks Drive were not returned.
A phone number listed for him at his Weeki Wachee home has been disconnected.

A background check revealed several judgments against him. He was convicted in September 1992 in Atlantic County, N.J., on a charge of theft by deception, according to records.

An employee at the Spring Hill sweepstakes room referred all calls to Mathis.
Mathis and current Allied Veterans National Commander Jerry W. Bass denied they run gambling rooms.

Players purchase cards that have a finite amount of Internet time. Customers may come and go and use the time allotted on the cards as often as they like until they run out.
Among the Internet sites accessed by users are the numerous sweepstakes games that resemble those seen on slot machines at casinos.

If a customer earns a jackpot, he or she can redeem the card in exchange for cash.
Mathis and Bass said the laws that pertain to Allied Veterans are the same that govern sweepstakes offered by McDonald's and Coca-Cola.

Bass complained about a story published recently in Hernando Today, claiming it depicted Allied Veterans and other sweepstakes businesses in a negative light.

He pointed to a trial last year in Ocala, during which the judge threw out the case because the state failed to prove the businesses were illegal gambling rooms.
"There have been no convictions in the court of law," he said.

Carolyn Kistler, a graduate student at the University of South Florida, has spoken to four former employees of Allied Veterans of the World, all of whom alleged their bosses paid them cash and failed to distribute their tax forms.

Another employee contacted Hernando Today with the same allegations.
All of those employees declined to give their names for fear of retribution.
Kistler said all of them earned between $8 and $10 per hour.

"They were seeing a lot of cash coming through and they were seeing literally thousands of dollars per day," she said.
Kistler, 63, recently interviewed a World War II veteran as part of a military history class when he abruptly ended the interview at 5 p.m.

"My wife and I are going to the casino," he told her.
Kistler thought he meant the Seminole Hard Rock Hotel and Casino in Tampa, but he actually meant a nearby gaming room.

She decided to write a paper about sweepstakes rooms and adult arcades for another one of her classes, she said.
"At first I thought it was going to be about seniors having fun playing Bingo," she said. "Then I realized it was a lot more than that."

Bass denied the former employees' accusations of payroll violations.
"Our attorney would never let them pay them under the table," he said.

A records request was submitted to Mathis last week asking for proof that 80 percent of Allied Veterans' proceeds went to veteran charities. Those requests went unanswered.
Another request to see copies of canceled checks and letters from those organizations that accepted donations also wasn't answered prior to deadline.

Mary Kay Hollingsworth, a spokeswoman with the North Florida/South Georgia Veterans Health System, confirmed Allied Veterans donated $125,000 to the VA hospital in Gainesville.
Other charities on the list include JROTC scholarships, Orlando VA Hospital, AMVETS, Florida Fallen Heroes and the Florida Department of Veterans Affairs.

Financial records from the state showed AVA also owned several vehicles, or "depreciating assets." In 2008, the agency owned three Lexuses, one Mercedes and four Cadillac Escalades.

On Jan. 27, AVA submitted a $200 check to the state for its registration fee. Those charities that receive contributions between $200,000 and $500,000 during the previous fiscal year are required to pay the $200 fee, according to state records.

The agency's mission, as read on its tax forms, is to "assist homeless veterans with counseling, medical and sanitary needs, as well as food and shelter."

Former employees claimed Allied Veterans distributed 10 percent or less to charity and the rest of the monies are distributed evenly among the individual business owners and Chase Burns, a software engineer out of Anadarko, Okla., who designed the programs used for the sweepstakes.

When contacted by phone, Burns referred all questions to his attorney - Kelly Mathis.


Reporter Tony Holt can be reached at 352-544-5283 or wholt@hernandotoday.com.

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