Firefighters National Trust, founded by Stephen Careaga, a onetime volunteer firefighter and reserve police officer from Gig Harbor, Wash., promised donations would go "directly to the spouses and children of the New York firefighters and rescue workers who lost their lives in the World Trade Center tragedy."

But after a high-profile gift of nearly $4 million to Engine 1, Ladder 24 -- the firehouse that was home to Fire Chaplain Mychal Judge, who died in the Twin Towers -- and a follow-up check for about $400,000, Careaga's charity's largess came to an abrupt halt, the Hartford (Conn.) Courant reported.

Millions promised in scholarships were never distributed, tax filings show. In addition to $1.6 million in money-losing ad campaigns and celebrity endorsement deals, donation money went to six-figure salaries for Careaga and an associate, the newspaper said.

Hundreds of thousands also went to legal fees to a board member's law firm and thousands more went to the software company Careaga created, the newspaper said.

When Firefighters National Trust shut down in 2005, key employees and their companies had received more than $1 million, tax filings show.