Federal authorities have charged several nonprofit employees with the misappropriation of funds intended for homeless services in the Los Angeles area, underscoring ongoing concerns about oversight at the Los Angeles Homeless Services Authority (LAHSA).

The charges include a 21-count indictment against Tanya Malone, an employee of the nonprofit Special Service for Groups, who is accused of accepting over $180,000 in bribes and kickbacks from Alexander Soofer, the former executive director of the nonprofit Abundant Blessings. Soofer, previously charged this year, has agreed to plead guilty to wire fraud and money laundering. According to prosecutors, Malone allegedly provided preferential referrals for homeless individuals to Abundant Blessings, including so-called “ghost” participants who never received services or housing at the organization’s sites.

In a separate case, federal officials accuse another individual, identified as Mitchell, of fraudulently obtaining more than $1.2 million in grant money from a nonprofit funded by Los Angeles County. Charged with wire fraud, Mitchell is alleged to have misused the funds for various personal expenses, including covering his bail bond following a 2024 arrest, inflating his salary, and paying for rent, family transfers, credit card debts, and even entertainment expenses such as PlayStation charges.

These allegations come amid growing scrutiny of LAHSA, the joint city-county agency responsible for coordinating homeless services in Los Angeles. Last year, following two critical audits revealing inadequate fund tracking and susceptibility to fraud, the Los Angeles County Board of Supervisors voted to withdraw county funding from LAHSA and establish a separate departmental structure for homeless services.

Housing and Urban Development Secretary Scott Turner criticized LAHSA at a recent news conference, calling the agency’s record “failing” and accusing it of enabling what he described as a “homeless industrial complex” where taxpayer funds are routinely mishandled.

LAHSA has maintained that its personnel are not implicated in the fraud cases and has pledged full cooperation with federal investigations. A spokesperson emphasized the agency’s commitment to ensuring that recovered taxpayer funds are redirected to their intended purpose of assisting unhoused residents in the region.

Separately, Special Service for Groups, where Malone was employed, acknowledged the allegations and stated that it has implemented enhanced prevention protocols and compliance measures to safeguard funds. The nonprofit stressed that all federal, state, local, and private funding entrusted to the organization must be carefully protected and used as intended.

First Assistant U.S. Attorney Bill Essayli characterized the fraud as emblematic of systemic failures in protecting public funds at both the state and county levels. He affirmed that federal authorities will continue to investigate and prosecute individuals responsible for exploiting taxpayer money designated for social services.