Veteran's fake military record prompts questions about charity

Paul Schroeder led a support group for post traumatic stress at The Woodlands United Methodist Church in 2011. Schroeder admitted last week that he embellished his military record. Paul Schroeder led a support group for post traumatic stress at The Woodlands United Methodist Church in 2011. Schroeder admitted last week that he embellished his military record. Photo: Melissa Phillip Photo: Melissa Phillip Image 1 of / 3 Caption Close Veteran's fake military record prompts questions about charity 1 / 3 Back to Gallery

Paul Schroeder's tale was so vivid it verged on cinematic: In March 2009, the decorated Army Special Forces veteran sat on his sofa in The Woodlands, with a drink in one hand and a gun in the other, not sure which shot he was going to take next.

In front of him floated the spectral face of a machete-wielding child he'd killed in self-defense during a secret mission in Rwanda, he said.

"I could literally feel the blood sticking to me all over again," Schroeder told the Houston Chronicle last year. "I could see his eyes. I still sit there and see him right now. It's not something that ever goes away."

He told a version of the same story to TV news crews, to fellow veterans in group therapy, and in a training video for the Houston Police Department as part of a post-traumatic stress disorder awareness program.

But Army records show Schroeder never served in Special Operations, never deployed anywhere, and never earned a Silver Star, Purple Heart, Combat Infantryman's Badge or other decorations he claimed. In reality, he served 10 years as a military policeman in New York, Texas and Panama before leaving the military in 2001.

Schroeder confessed last week to a Houston Chronicle reporter that he had embellished his record. His admission raises concerns about vetting procedures at PTSD Foundation of America, the faith-based nonprofit for veterans in Houston where Schroeder worked as director of counseling since 2010. It also prompts larger questions about an organization that is supposed to help veterans cope with stress, but appears to be financially unstable.

Tax records show PTSD Foundation has been in the hole for at least three years and is carrying more than $200,000 in debt.

Discharge papers

The Chronicle first questioned Schroeder's record after interviewing him almost a year ago. At the time, he claimed to have served three combat tours in Afghanistan and one in Iraq, as well as secret missions in Africa and Central and South America.

The newspaper asked to see his discharge papers, but he never produced them. When pressed again earlier this month, he said they were top secret.

"I come from a culture where we vet people a little differently and through connections, who we know, who was there, etc.," Schroeder said. "I didn't even think about a document that I can't produce, that they will not release, so I don't know what I can do to help answer your questions. But providing a document such as that, especially giving one to a reporter, is just a guaranteed way to put myself in a jail cell."

Military discharge papers do not contain classified information, said Army spokesman Mark Edwards.

Until Schroeder called the reporter to confess Wednesday, PTSD Foundation's chairman Gene Birdwell and its director of operations, Pastor David Maulsby, stood steadfastly by him.

Schroeder came to the foundation from a Houston auto dealership, where he worked as a sales associate until voluntarily resigning in 2009.

Schroeder initially had sought help for PTSD, Birdwell said. He said he did not ask to see Schroeder's discharge papers when he hired him.

"I didn't care," Birdwell said on Tuesday, the day before Schroeder came clean. "I knew he was needing help and we helped him, and he's our best counselor," he said.

Told that Army records contradicted Schroeder's claims, Birdwell replied, "OK, so what? ... I'm only concerned about the job. He's doing a great job."

In the same interview, Birdwell declined to answer detailed questions about the nonprofit's financial situation unless the reporter signed a non-disclosure agreement.

"Our donors are confidential and where our money comes from is confidential and where it goes is confidential," he said.

After Schroeder admitted lying and resigned, PTSD Foundation issued a statement Friday, saying that everyone involved in the nonprofit's work was shocked.

"What we saw in Paul was a person of great passion to help others, and a unique ability to help many, many struggling souls," the statement said. "We are, and will continue to be, a transparent organization. Any past, present or future donors that are concerned with where their contributions are going are more than welcome to view our financial statements."

Sen. Patrick on board

The news stunned the organization's donors and board members. Several also said they had no idea the charity was in the red or in debt.

Gallery Furniture owner Jim McIngvale donated about $20,000 to PTSD Foundation last year. "I'm a very trusting person," McIngvale said. "It sounded like a good deal, and if it's not what it was reported to be, it's very disappointing."

PTSD Foundation's board members included state Sen. Dan Patrick, R-Houston, and area pastors, veterans, businesspeople and accountants.

The senator said he joined the board in an advisory capacity several years ago at Birdwell's request. Records show Birdwell has donated a total of $10,000 to Patrick's campaign.

Patrick said he never attended any board meetings.

"I was there for moral support and to my knowledge, they were doing everything right until they hired this impostor," he said. "I'm disappointed that someone would lie about their military record, and I'm disappointed the people who hired him didn't do a full background check."

Patrick said he has resigned from the board.

For Houston's veterans, the fallout was personal.

Members of the Lone Star Veterans Association asked for their logo to be taken off PTSD Foundation's website, where they are listed as partners.

"It's important to maintain integrity when helping and serving veterans, especially if you are one, because you have to build and maintain that other veteran's trust, and when you cannot do that, it jeopardizes many of us, and our reputation throughout the industry," said John Boerstler, an Iraq War veteran and president of LSVA.

Birdwell made loan

PTSD Foundation of America is an alternative name for Impact XXI Houston, a tax-exempt public charity started in 2005 as a fundraising arm for Campus Crusade for Christ's Military Ministry, Birdwell said.

The foundation, which provides spiritual mentoring and aid to veterans suffering from PTSD, is collecting donations to build a transitional housing facility called Camp Hope in northwest Harris County.

"I wouldn't be the man that I am today without the foundation, that's just the way it is," said Marine veteran Eric Paine. "I'd be either dead, still homeless sleeping under the bridge one way or another."

Tax returns filed by PTSD Foundation reveal that the charity is $220,000 in debt, in the form of a loan that the Chronicle confirmed was from Birdwell. The most recent filing shows a negative fund balance of $107,236 in 2010, down from more than $140,000 in 2009 and 2008.

"It shows that the group is struggling to stay afloat and dependent on this loan," said Daniel Borochoff, president of CharityWatch, a charity rating organization in Chicago.

The fact that the loan came from Birdwell also is problematic. Birdwell, who runs the foundation out of the same office as his company, G.R. Birdwell Construction, is not identified as the source of the loan in PSTD Foundation's tax filings, as required, but in an interview last week he acknowledged the loan came from him.

Although trustees sometimes do make loans to charities, it isn't considered best practice to do so, said Sandra Miniutti, vice president for Charity Navigator, a charity watchdog in New Jersey.

"It's not good governance," Borochoff said. "It has a higher likelihood of failing than a setup that would have an independent board."

'Not in good standing'

The nonprofit's tax filings do not list any salaries for key employees and give only vague descriptions of expenses, such as "various grants to organizations" for $152,785 in 2008 and "various grants to individuals" for $33,100 in 2010. Birdwell explained that he pays the salaries of the foundation's director of operations and executive director out of the payroll for his construction company.

"Public charities need to be very transparent about finances and that's not happening here because so much of the money is off the books," Borochoff said.

PTSD Foundation showed a deficit for the first time in 2008. That year, the group raised $146,155 in donations, but spent more than $312,000 on expenses, primarily on a festival to honor U.S. service members that cost $307,098.

Compounding the organization's headaches is the fact that it is listed "not in good standing" with the state after failing to file an annual business tax report last year. As a result, Texas could revoke the foundation's charter.

PTSD Foundation's overdue tax report is a mistake that has been corrected, said Pastor Maulsby, director of operations. As of Friday, however, the state comptroller reported the organization still was not in good standing.

lindsay.wise@chron.com