Feds Charge 3 in Alleged Homelessness Aid Fraud in California Federal officials charged three defendants in an alleged scheme to exploit programs for homeless Californians, spending funds on a Tahiti vacation, a nightclub, and luxury vehicles. Federal officials announced charges against three defendants accused of exploiting programs intended to provide housing and services to homeless Californians, with two arrested Wednesday morning. The funds meant for Los Angeles' homeless were allegedly spent instead on a Tahiti vacation, a high-end nightclub, luxury vehicles and other personal expenses, federal authorities said Wednesday as agents fanned out across the city in an early-morning fraud crackdown. At the center of the crackdown is Michael Young, 46, a founder of Culver City-based nonprofit Home At Last, who received more than $118 million in public funds through government contracts, including more than $75 million from the Los Angeles Homeless Services Authority, according to prosecutors.Prosecutors allege Young misappropriated millions, including more than $7.5 million through a sham vendor scheme. The days of these wire fraud experts flying on private jets, driving around Beverly Hills in Range Rovers and doing lavish things is over, HUD Secretary Scott Turner said. Michael Young, 46, Lakiya Malone, 48, and Donye Mitchell, 55, were charged in the federal fraud crackdown, authorities said Wednesday. Two were arrested Wednesday, while a third was considered a fugitive.Prosecutors allege Young used shell companies and fraudulent billing practices to divert taxpayer money, spending more than $1 million to open and operate Six Seven Five Lounge, a high-end Inglewood restaurant and nightclub. At Wednesday's news conference, federal officials also accused Young of spending nearly $50,000 on a luxury Tahiti vacation and $140,000 restoring a vintage Chevrolet Impala.Authorities also arrested Lakiya Malone, 48, an employee of Special Service for Groups, on a 21-count indictment alleging she accepted more than $180,000 in bribes and kickbacks from Alexander Soofer, executive director of nonprofit Abundant Blessings. In exchange, Malone allegedly provided priority referrals, including ghost homeless participants who never lived at the housing sites. Prosecutors allege their files were fabricated using fake welcome letters, forged sign-in sheets and falsified eligibility forms.Soofer, who was previously charged, has agreed to plead guilty to wire fraud and money laundering. He admitted obtaining $23 million in public money intended to combat homelessness. A third defendant, Donye Mitchell, 55, CEO of The Big Blue Umbrella, is considered a fugitive. Prosecutors allege he obtained more than $1.2 million in grant funding after making false representations and later used grant money for personal expenses including bail-bond costs, credit card debt, family transfers and PlayStation charges.If you or someone you know has defrauded money allocated for the homeless, I suggest you report it to law enforcement, First Assistant U.S. Attorney Bill Essayli said. If you don't, your door may be the next one we're hitting. The charges come amid a broader federal crackdown on fraud linked to homelessness programs, with authorities vowing to pursue anyone who exploits public funds meant for vulnerable populations.FBI agents were seen taking positions outside Malone's home in Los Angeles on Wednesday, Sept. 16, 2026, as part of the operation. Malone was later seen walking out of her home toward federal authorities with her hands raised. Soofer and other figures connected to the case have drawn scrutiny as part of a wider investigation into charities and contracts tied to California homelessness spending.