Feds Charge Three in $12M LA Homeless Fraud
Feds Charge Three in $12M LA Homeless Fraud
The News
Federal prosecutors charged three people in the Los Angeles area Wednesday with stealing $12 million in federal and state homelessness aid and spending it on real estate, luxury trips and vintage vehicles.
Federal authorities arrested at least two people employed at Los Angeles-area homeless nonprofits, the Los Angeles Times reported. A third defendant is a fugitive and being sought by the FBI.
The charges include wire fraud, bribery and money laundering, according to Fox News.
What the Money Allegedly Bought
Prosecutors say taxpayer money meant for shelter and services went to a Tahiti vacation, an Inglewood nightclub, luxury and vintage cars, a home in Greece, and bail, according to the Justice Department accounts reported by Reason, Fox News and WorldNetDaily.
The Defendants
One nonprofit founder is charged in an alleged $7.5 million scheme in which money allegedly moved through shell companies, The Washington Times reported. Wire reporting identifies the nonprofit as Home At Last, which it says has received more than $118 million in public funds since 2019.
Lakiya Malone faces a 21-count indictment accusing her of taking more than $180,000 in bribes and enrolling participants who did not exist, according to Wire reporting of the Justice Department case.
A third defendant, Alexander Soofer, admitted obtaining $23 million in public funds and pocketing at least $2 million, per the same reporting.
Timeline
Home At Last begins a run of public funding that Wire reporting puts at more than $118 million to date.
Federal agents arrest at least two employees of Los Angeles-area homeless nonprofits; the FBI searches a Los Angeles home tied to one defendant.
The Justice Department announces the charges, describing wire fraud, bribery and money laundering across separate homelessness fraud and corruption cases in Southern California.
Reactions
HUD Acting Inspector General Brian D. Harrison called the alleged conduct "an attack on the most vulnerable communities."
First Assistant U.S. Attorney Bill Essayli said the cases "expose a profound failure" by California and Los Angeles County to safeguard public money.
Conservative outlets treated the arrests as proof of systemic failure in California's homelessness spending. PJ Media and Twitchy both noted that Los Angeles Mayor Karen Bass stepped down from the Los Angeles Homeless Services Authority board shortly before the announcement, and Twitchy said she has been invited to testify at a congressional hearing. No source in this story accuses Bass of a crime, and she has not been charged.
Left-of-center coverage, including the Los Angeles Times and The Independent, framed the arrests as part of a sweeping federal crackdown on misappropriated homelessness funds rather than an indictment of state government.
What's Next
Essayli said his Homelessness Fraud and Corruption Task Force is pursuing the people who enabled the alleged fraud, not just the three named defendants.
The FBI is still searching for the fugitive defendant, 55, who faces a wire fraud count carrying up to 20 years in prison.
Open questions: how much of the $118 million in public funding can prosecutors tie to fraud beyond the $7.5 million alleged so far, and whether investigators name officials at public agencies who signed off on the billing.
More
Most outlets in this story reported three defendants charged Wednesday. The Gateway Pundit reported four people charged, and Wire's own summary used the same count — the discrepancy appears to turn on whether a previously charged defendant is included in the tally.
The Justice Department's own framing, as reported by Reason, is that workers at Los Angeles homeless nonprofits spent tax dollars on vacations, nightclubs and bail.
Poll
Who should be held responsible for the missing homelessness money?
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