Law enforcement today arrested two defendants, out of three total, who have been charged in separate federal homelessness corruption and fraud cases, including a founder of a Culver City, California,-based nonprofit who allegedly misappropriated more than $7.5 million in taxpayer funds. Used this money for commercial real estate and to finance the construction of a nightclub and adjacent bingo hall. Today’s enforcement action is the latest effort by the Homelessness Fraud and Corruption Task Force to investigate, combat.
Key details of the case
Prosecute fraud, waste, abuse, and corruption involving funds allocated toward the eradication of homelessness within the seven-county jurisdiction of the Central District of California: Los Angeles, Orange, Riverside, San Bernardino, San Luis Obispo, Santa Barbara, and Ventura. “Today the Department of Justice, with the full force of the federal government, is announcing charges in a major fraud takedown targeting schemes that stole millions from programs meant to house California’s homeless,” said Assistant Attorney General Colin M. McDonald of the National Fraud Enforcement Division.
Moreover, “As alleged, Michael Young, through Home at Last, received more than $100 million in taxpayer funds and misappropriated more than $12 million, diverting that money into shell companies, real estate. Even a nightclub and bingo hall. That scheme is now halted in its tracks.
Meanwhile, my message to every fraudster who steals from the vulnerable is clear: We will track you down, bring charges where the evidence leads. Work relentlessly to reclaim every taxpayer dollar you stole.”. “These defendants are accused of systematically diverting over $12 million in taxpayer funds for personal gain – robbing hardworking American citizens and directly hurting the people those funds are intended to support,” said FBI Director Kash Patel.
Enforcement actions and official statements
In addition, “Thanks to President Trump’s leadership and our interagency partners, fraud no longer has a safe haven in America. This FBI will act to hold those responsible accountable for their fraud – and today’s arrests demonstrate our continued commitment to protecting every dollar of taxpayer resources and ensuring that public funds are used exactly as intended.”. “Today’s arrests mark a major success for our Homelessness Fraud and Corruption Task Force and this Administration’s commitment to protecting taxpayers,” said First Assistant U.S.
As a result, attorney Bill Essayli for the Central District of California. “The scale and brazenness of these fraudsters expose a profound failure by the State of California and Los Angeles County to safeguard public funds. Millions intended to house the homeless allegedly financed private real estate, a nightclub, a bingo hall, and personal expenses. For complete details, refer to the official DOJ press release.
We will follow the money, expose the corruption, and prosecute those who exploit the American people for personal gain.” . “Today’s actions reflect our commitment to protecting taxpayer dollars and ensuring accountability of public funds,” said Special Agent in Charge Darren Lian of the IRS Criminal Investigation’s Los Angeles Field Office. “The evidence uncovered by IRS Criminal Investigation and our law enforcement partners reveals a deliberate scheme to defraud government programs designed to support vulnerable community members who are experiencing homelessness.
We will continue to pursue those who steal from the public and hold them accountable.” . “Stealing from programs meant to feed, shelter. Support people experiencing homelessness isn’t just a financial crime – it’s an attack on the most vulnerable communities provided for by HUD programs,” said Acting Inspector General Brian D. For related coverage, see EU sanctions against Russia: 21st package expands banking, crypto and oil restrictions.
Specifically, harrison of the U.S. Department of Housing and Urban Development, Office of Inspector General (HUD-OIG). “HUD-OIG is steadfast in pursuing those who exploit federal housing programs.
Subsequently, this case underscores the strength of our partnerships with law enforcement and prosecutors. Together, we protect taxpayer dollars and deliver justice for victims.”. The two defendants arrested today are expected to make their initial appearances this afternoon in United States District Court in downtown Los Angeles. For related coverage, see Trade Sanctions on Israeli Settlements Announced by 12 Nations Including UK, France, Canada.
At the same time, the three new criminal cases being announced today are described below, as well as a guilty plea in a previously charged case:. Michael Young, 46, of Baldwin Hills, a founder of the Culver City-based nonprofit Home At Last (HAL), was arrested today on a federal criminal complaint alleging he engaged in a years-long, complex scheme to defraud taxpayers and public entities providing funding for homeless housing. Some of the affected programs were administered by the Los Angeles Homeless Services Authority (LAHSA), the lead agency that coordinates housing and social services for the homeless in Los Angeles County.
In particular, young is charged with wire fraud, a felony that carries a statutory maximum penalty of 20 years in federal prison. According to the complaint, Young used a web of shell corporations and fraudulent billing practices to misappropriate millions of dollars in taxpayer funds earmarked for homeless housing, including through programs administered by LAHSA. Among other gross misuses of taxpayer money, Young spent more than $1 million to open and operate a high-end restaurant and nightclub in Inglewood called Six Seven Five Lounge. .
Furthermore, through numerous contracts with LAHSA and other public entities, Young received more than $118 million in public funds from LAHSA, the City of Los Angeles, the County of Los Angeles. The United States Department of Housing and Urban Development. LAHSA alone paid HAL over $75 million for homeless housing services.
Investigation and prosecution details
Young allegedly used a sham vendor fraud to misappropriate more than $7.5 million of these funds. Young lied repeatedly during the fraud, according to allegations in the complaint, claiming funds would be used for homeless housing or for vendors providing services for homeless housing, when he diverted large amounts of taxpayer money for personal use and unrelated businesses. He created sham vendors to hide self-dealing transactions, submitting fake bids, forged signatures. Fraudulent invoices to make it appear the sham vendors were legitimate, third-party companies, offering fair market services, when in reality, the vendors had no employees, no locations, no legitimate operations, and existed only to funnel public money back to Young.