A New York veterans' charity created to offer outdoor retreats for injured service members became a personal source of money for its leaders, state prosecutors allege in a civil lawsuit.
The lawsuit filed by the Office of the New York Attorney General claims that Healing for Heroes, A Disabled Veteran's Retreat and Wooded Oasis, Inc., misled local community groups, businesses, and donors. According to the lawsuit, the charity used their donations to pay for personal luxuries and improvements for its founders instead of helping former service members. According to legal filings submitted by the Office of the New York Attorney General, the charity raised nearly $100,000 in donations after launching in 2024.
Investigators say almost half of that money went toward personal shopping trips, restaurant meals, vehicle repairs, fuel, and improvements to property owned by the charity's leaders. State officials are asking the court to shut down the organisation, ban its founders from running non-profits in New York, and order them to return the misused money and pay civil penalties.
Private stays and turned-away applicants
The charity operated from a 30-acre wooded property in Bemus Point, Chautauqua County.
Its official promotional materials said the land would offer a free, peaceful place for wounded former service members to rest and recover. Investigators from the Office of the New York Attorney General found that the non-profit held just four retreats in 2024 and 2025. All four events were attended only by board members, their relatives, and close personal friends.
This meant donated money was effectively used to pay for private family holidays.
When disabled veterans with no personal ties to the charity's leaders asked about booking stays, the organisation turned them away before they could even apply. Court documents say the charity's leaders later claimed they could not afford to host full weekend retreats. Instead of offering stays lasting several days, the organisation held short gatherings with food donated by local businesses. These events included activities called "Free Pizza & Fire Night" and "Coffee and Donuts."
Each gathering lasted only a few hours and cost the organisation almost nothing.
Unreported income and personal accounts
Along with collecting donations, Board President Thomas Nelsen and Board Secretary and Treasurer Jennifer Milchanoski-Nelsen rented out the 30-acre property in Bemus Point through Airbnb at least 32 times in 2024 and 2025. Their rental listings told holidaymakers that all the money earned would support disabled veterans. However, state investigators found that the couple kept all $33,312.16 earned from these rentals.
The payments went directly into their personal bank account. The Office of the New York Attorney General found that the non-profit started collecting money from the public in 2024 before registering as a charity in New York state. The organisation also operated without an effective board of directors or a formal policy to manage conflicts of interest. Financial checks showed that cash donations and payments through Venmo went into personal accounts instead of accounts held by the organisation.
The leaders also failed to record donated work, professional services, and valuable equipment given by supporters. These items included several all-terrain vehicles and an SUV.
Misleading promises to donors
The charity's fundraising campaigns promised that 100 percent of public donations would pay for therapeutic retreats for former military personnel. Instead, court records show that donations paid for a new wooden deck and a complete bathroom renovation at the Nelsen home.
"Our veterans have sacrificed so much for this country, and they deserve real supportive services when they return to civilian life," Attorney General Letitia James said in a statement released by her office.
"Healing for Heroes exploited veterans' service and betrayed the trust of their donors, including local community members, veterans' organizations, and businesses to enrich themselves and their friends.
My office has no tolerance for charities that use noble causes to scam New Yorkers out of their hard-earned money."
Demands for dissolution and financial penalties
The civil lawsuit filed by the Office of the New York Attorney General accuses the organisation and its officers of breaking state charity laws, using deceptive business practices, making false advertising claims, and failing to keep basic financial records. Prosecutors want the court to shut down the organisation permanently and transfer its remaining assets to legitimate non-profit groups that help disabled veterans.
The lawsuit also asks the court to permanently ban Thomas Nelsen and Jennifer Milchanoski-Nelsen from collecting charitable donations or serving as officers or directors of any non-profit registered in New York state. The state is seeking full repayment of the money taken from donors, along with fines set by law. Legal filings request penalties of $1,000 for each violation of New York charities law and up to $5,000 for each violation of the state's FAIR Business Practices Act. Assistant Attorney General Paulette Campbell is leading the case through the state regional office in Buffalo.