A nonprofit that sought and collected donations supposedly for paid phone cards for veterans and their families was ordered by a Minnesota court Thursday to shut down after the state Attorney General's Office said the charity fraudulently collected hundreds of thousands of dollars.

Along with closing operations, Colorado-based TREA (The Retired Enlisted Association) Memorial Foundation must come up with more than $400,000 that will be distributed to legitimate veterans-support groups in the state, according to the Minnesota Attorney General's Office, which prevailed in Ramsey County District Court.

The foundation "did not purchase a single phone card to veterans or their families for years — all while it collected hundreds of thousands in contributions from Minnesotans," read a statement from the office of Attorney General Lori Swanson.

TREA director of operations Debbie Osborne said Thursday the foundation actually did buy thousands of phone cards and distributed them to veterans and families "when applications were received."

However, the lack of applications left many cards wanting for a recipient. That inventory was donated to the Veterans Affairs Medical Center in Aurora, Colo., for distribution to veterans and their families, Osborne said.

In addition, Osborne continued, "advancements in cellphone and internet technology caused the phone card program to become obsolete before the foundation was able to hand out the inventory of cards."

Swanson's spokesman, Ben Wogsland, said TREA has 60 days to pay out the money to veterans-related charities, which have yet to be identified, and 90 days to close shop, Wogsland said.

While TREA solicited money around the country and has many chapters in every U.S. time zone, Minnesota is the first state to win such a court order against TREA, Wogsland said.

Between 2012 and 2017, the foundation raised at least $14 million nationwide and more than $345,000 of that total from Minnesotans through professional fundraiser Jeremy Squire and Associates, according to Swanson's office. Most of the money, Wogsland said, went to pay the fundraiser.

About half of the mailed solicitations sent in Minnesota using the name "The Armed Forces Aid Campaign" promised the donations would help provide a phone card to allow a soldier or veteran to call home.

Help 'America's Heroes'

One mailing pledged the foundation would "use your gift to put a live, activated VA Hospital Phone Card in the hands of one of America's Heroes."

No cards were handed out after 2014, and TREA's total spending on phone cards from that year through 2017 represented less than 0.9 percent of the nearly $9 million it collected in donations.

"Minnesota is home to more than 330,000 veterans and is one of the most generous states in the country," Swanson said. Charities that take advantage of the desire to give back to service members, veterans, and their families using deception have no place in Minnesota."

The foundation chose to settle with the state of Minnesota in order to use its remaining resources "to fulfill its mission of helping veterans and their families, rather than paying legal fees or fines and penalties," Osborne said.

The foundation's dissolution also means an end to several of its other programs that Osborne said have provided millions of dollars in aid and support for thousands of veterans and military families.

"It's a shame that all of these programs will now have to come to an end," she said.