The military charity Help for Heroes has paid out more than £150,000 to former members of staff since 2012, according to a report by the charity watchdog.
The Charity Commission conducted a review after "serious concerns" were raised two years ago about Tedworth House recovery centre in Wiltshire.
Among the issues were a claim that safeguarding procedures were not always followed.
There were also accusations of bullying, and allegations that staff who raised concerns were being paid off.
The commission found the charity had paid out about £158,000 to settle employment claims since 2012, but said proper procedures were followed and funds were used correctly.
The review found safeguarding procedures to protect vulnerable adults were not all included in the staff manual, and therefore not always followed, but the commission said it was satisfied this was no longer the case.
The report noted that "the charity is taking steps to continually review and improve its policies and ensure that they are properly implemented and communicated to staff, beneficiaries and volunteers as appropriate."
Alex Scott-Barrett, chairman of Help for Heroes' trustees, welcomed the report.
"The commission concluded its review in June and made it clear that we had all the right guidelines in place. We are committed to doing our best for our veterans and are glad the report shows that we are always striving to improve the support we give to those who rely on us."