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Where is the money raised from Trump event going?
05:48 - Source: CNN
Los Angeles CNN  — 

The veterans group that hosted Donald Trump for a speech this week on board a decommissioned battleship had its tax-exempt status revoked by the IRS in August.

The group, Veterans for a Strong America, sounds like a charity, and in a press release touted having more than a half-million supporters across the U.S. In reality, it is a political action group whose tax-exempt status was revoked in August because it failed to file tax returns for the past three years. The group is appealing the decision. In addition, CNN has found scant evidence that Veterans for a Strong America has the supporters it says it does.

The Trump campaign said it did not know about the organization’s issues until after the event. People paid between $100 and $1,000 to attend the speech on the U.S.S. Iowa.

The founder and chairman of VSA is a former Army officer named Joel Arends, who served in Iraq in 2004. He’s an attorney and political consultant in Sioux Falls, South Dakota, where VSA is based. In its most recent filing this spring with the Federal Election Commission, the organization reported it had $30 in the bank and owed $318 to a Washington consulting firm.

CNN was unable to reach Arends for comment, but VSA sent a statement which reads in part, “Veterans for A Strong America consulted with top legal counsel and the event hosted by the organization with presidential candidate Donald Trump was planned and conducted in full compliance with all applicable law. There are some paperwork glitches related to a predecessor organization and VSA is in the process of sorting those out.”

In addition, the statement listed VSA’s “accomplishments,” such as “providing legal services and support to veterans unfairly dismissed from their jobs…. Advocating that members of Congress reform the VA… Successfully fighting for the creation of a Special Committee to Investigate the events surrounding Benghazi.”

Hope Hicks, a spokeswoman for the Trump campaign, said it had no idea tax exempt status had been revoked. And she added in an email:

“But it legally doesn’t matter on our end whether it’s a 501c4, 527, etc.–same rule permits showing up and giving a speech.”

She said Trump had never met Arends before the Tuesday evening event aboard the U.S.S. Iowa.

Prior to the event, Veterans For a Strong America issued a press release in which it claimed more than 500,000 supporters, but outside of Arends, CNN has found it difficult to find anyone with a direct link to the group.

A South Dakota doctor named Annette Bosworth says she’s known Arends for years, and they used to be friends, but she blames him for her criminal and legal issues. Bosworth hired Arends as both a lawyer and a political consultant when she ran for the Republican nomination to the U.S. Senate seat in the state in 2014.

She needed signatures to get on the ballot, and state law requires candidates to be present when voters sign those petitions. Bosworth says Arends gave her bad advice, she signed a document saying she witnessed the signatures when she hadn’t and she was convicted of 12 counts of election fraud. The jury didn’t buy her story blaming Arends and she was also convicted of perjury. Bosworth is serving three years probation. As a result of her conviction, the South Dakota Medical Board revoked her license to practice medicine.