Veterans charity fight AG’s charges
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The operators of a veterans retreat in Bemus Point are fighting charges filed in August by the state Attorney General’s Office.
Attorney General Letitia James alleges Healing for Heroes – A Disabled Veteran’s Retreat and Wooded Oasis Inc. defrauded donors, billed itself as an outdoor retreat for disabled veterans and hosted limited retreats that served board members and their friends and family - essentially using the charity to fund their own vacations. An investigation by the Office of the Attorney General (OAG) found that the owners of Healing for Heroes’ 30-acre property, Board President Thomas Nelsen and Jennifer Milchanoski-Nelsen, board secretary and treasurer, rented out the property on Airbnb on at least 32 different occasions in 2024 and 2025, claiming all proceeds would go to their charity. Instead, the couple kept the $33,312.16 proceeds from the rentals for themselves. The Attorney General’s office investigation also found that almost half of the nearly $100,000 donated to the organization was spent on property maintenance and improvements, such as a bathroom renovation and a new deck for the property, as well as personal shopping, meals, vehicle repair and gas expenses for board members.
The Nelsens, through their attorney, are fighting back in court documents filed recently in state Supreme Court in Erie County.
“This case is a classic example of government overreach,” attorney Ryan K. Cummings of Hodgson Russ LLP in Buffalo wrote in his Memorandum in Opposition to the state’s petition. “The Attorney General’s office began with the headline it wanted for its election-season press release and created a story to support that headline. The AG’s story is a fiction based on assumptions, innuendo, and falsehoods. As a threshold matter, the petition is not supported by evidence in admissible form. It is built on attorney representations that are not made on personal knowledge. It relies on a series of documents that have not been authenticated or provided and in many instances those summaries are demonstrably wrong. Finally, the petition is predicated on two affirmations from the fall of 2025 by two individuals who were tangentially involved with Healing for Heroes – A Disabled Veteran’s Retreat and Wooded Oasis Inc., separated from the organization in May 2024 and February 2025, respectively, and who were unceremoniously cut off from the organization following dishonorable conduct. The AG’s house of cards collapses under the weight of these infirmities.”
Cummings said the nonprofit provide weekly coffee and donut meetings, pizza and bonfire nights, equine therapy and overnight retreats. The charity entered into a lease with the Nelsens to pay nominal monthly rent, utilities and maintenance while the Nelsens are responsible for property taxes, insurance and the monthly mortgage.
Cummings said accounting records from Healing for Heroes’ independent accountant show they have put personal resources into Healing for Heroes with accounting records accounting for all donations and expenditures. Every donated dollar, Cummings said, has been tied out to an expense, or bank balance, for Healing for Heroes, though Cummings said there have been times the organization hasn’t met some aspects of the law.
“Not unlike many small charities – and even many large charities in Erie County – Healing for Heroes has occasionally failed to comply with certain technical requirements under New York Law, but when it is notified of how to comply, it does. With the ongoing support of professionals, Healing for Heroes is committed to continuing its good governance improvements.”
Cummings argues in his memorandum that the Attorney General’s office has not met the burden of proof require to create a question of fact while not demonstrating evidence of fraud or false advertising, with the state’s conclusions are false based on documentary evidence.
and should be dismissed.
“Finally, the petition claims that respondents engaged in false advertising becasue the donations did not go to overnight retreats,” Cummings argued. “But the solicitation letters expressly seek building materials, power equipment, accessibility upgrades, contractor work, marketing, meals, travel and activities. Even the donation-jug language quoted by petition refers to completing projects necessary to host veterans. Under Executive Law Section 172-d(4) the question is whether the use is substantially consistent with what was solicited. Healing for Heroes’ use of that donated funds and services to perform propety upgrades is consistent with solicitations … Simply put the AG’s conclusory assertion of fraud is belied by the undisputed evidentiary record. The petition should be denied.”
James is seeking a court order to dissolve the organization and distribute its assets to charities that actually honor Healing for Heroes’ stated mission. James is also asking the court to bar the Nelsens from soliciting money or serving in leadership positions for any other New York-based charity. James also asks the court to recoup damages from the Nelsens and impose civil penalties for violations of the FAIR Business Practices Act.
Cummings said that result is too harsh, instead asking for an opportunity to resolve any further issues or that the court direct a focused CPLR Section 410 trial.
“Here is it respectfully submitted that the substantive allegations of wrongdoing have been debunked and the technical noncompliance issues have been resolved,” Cummings wrote. “If additional noncompliance issues are identified by petitioner, an order directing respondents to resolve them should be issued. Nothing further is required or needed, and Healing for Heroes should be permitted to continue serving the veterans of this community.”