Hatch is suing Hmong foundation

04/20/2005

Paul McEnroe and Tony Kennedy, Star Tribune
April 20, 2005

A Minnesota nonprofit foundation named after Hmong leader Gen. Vang Pao has been involved in questionable spending of hundreds of thousands of dollars while skirting state charities laws, Attorney General Mike Hatch said Tuesday in a lawsuit that seeks to shut down the organization.

The St. Paul-based Vang Pao Foundation has operated since its inception in 2000 without a proper board of directors, has not properly recorded its finances, solicited donations without registering as a charity and has allowed two of the general’s sons and one of his nephews to control more than a half-million dollars in two bank accounts, according to court records.

One son, Cha Vang, is under FBI investigation as part of a federal probe into possible influence peddling at St. Paul City Hall. He was not available for comment, and his attorney, B. Todd Jones, declined to comment Tuesday. Cha Vang solely controlled more than $230,000 of foundation money, of which $5,362 was spent on foreign travel, $8,079 at retail stores and $3,235 at restaurants, according to the allegations in the civil complaint.

In another bank account, controlled by foundation officers Lia Vang and Chao Vang, records indicate 44 electronic transfers, “many of them large sums,” to and from business bank accounts for Dom’s Liquor in Minneapolis and Lakeridge Liquor in Vadnais Heights.

In the past four years, the foundation has drawn an undetermined amount of money from the national Hmong soccer tournament and sports festival held Memorial Day weekends in St. Paul, the suit states.

Average gross receipts from each year’s festival are estimated between $40,000 and $67,000 and proceeds go to the foundation, which does not accurately document festival receipts, revenues or expenses, according to the complaint.

The suit, filed Tuesday in Ramsey County District Court, seeks court-ordered fines and an injunction to put the foundation out of business. No hearing date has been set.

Lia Vang, identified in bank statements as the foundation’s vice president and secretary, said Tuesday, “I have no problem with them shutting this thing down. If they don’t think we can do it, bring Hmong people together, shut it down and leave the Hmong problems to the state.”

Lia Vang, a nephew of Gen. Vang Pao, said money taken in by the foundation to sponsor the sports festival has paid for festival insurance, security and related costs.

“Everyone assumes the festival was making a lot of money,” he said. “The foundation doesn’t have any money. It has paid for the festival and other activities. But at the end of the day, there has not been enough income to offset expenses.”

The complaint said two Vang Pao Foundation bank accounts have handled “approximately $536,371 since 2001 with no board management and little or no documentation.”

Cha Vang, who is listed in some records as a project manager at the foundation, had sole control over one of the accounts from April 2001 through January 2003, according to bank records examined by the state. Investigators reported that the records “reflect large withdrawals and payments with no documentation as to their purpose or propriety.”

Cha Vang told the attorney general’s office that he had few documents because records sought by investigators were burned in an arson fire that destroyed his Maplewood home in 2004.

Since early this year, the FBI has been investigating an allegation made by ex-St. Paul police officer Tou Mo Cha that Cha Vang once told him that for $25,000 he could fix at City Hall a problem the officer’s wife was having with keeping a liquor license for the couple’s St. Paul nightclub. Cha Vang has denied the allegations.

Cha Vang also was involved in a taxpayer-subsidized Hmong funeral home project in St. Paul that has been under FBI investigation since spring 2004 for alleged bribery involving one of Mayor Randy Kelly’s assistants, Sia Lo. Vang is friends with Lo, who was put on paid administrative leave by Kelly in February after the Star Tribune published stories on the FBI probe. Before Kelly was mayor, Cha Vang worked in the mayor’s office as an assistant to then-Mayor Norm Coleman.

When the Kelly administration was arranging the funeral home project, the Vang Pao Foundation was in line to run it, but the foundation couldn’t raise enough money to pay its share of the construction costs.

According to the complaint, the foundation paid Cha Vang $25,000 in June 2003 for six months of “consulting services.”

The foundation’s bank records show many transactions to cover trips to Thailand. Lia Vang said, “I am not aware of the money spent in Thailand.”