Three people were charged Wednesday in separate federal cases alleging fraud involving Los Angeles-area homelessness programs, including a Culver City nonprofit founder accused of diverting more than $7.5 million in public money, some of which he allegedly used to finance an Inglewood nightclub and adjoining bingo hall.
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Michael Young, 46, of Baldwin Hills, a founder of Home At Last, and Lakiya Malone, 48, of South Los Angeles, an employee of Special Service for Groups, were arrested Wednesday morning.
Authorities were still looking for Donye Mitchell, 55, of Orange, as of Wednesday morning. Mitchell is the CEO and executive director of the Los Angeles-based nonprofit The Big Blue Umbrella and was considered a fugitive.
Young is charged with wire fraud for allegedly using sham vendors to siphon money from publicly funded homeless housing contracts.
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Home At Last received more than $118 million from the Los Angeles Homeless Services Authority, the city and county of Los Angeles and the U.S. Department of Housing and Urban Development, prosecutors said. LAHSA paid the nonprofit more than $75 million for homeless housing services.
Young allegedly concealed his control of the vendors through fake competing bids, forged signatures and fraudulent invoices, according to federal officials.
More than $1 million went toward opening and operating Six Seven Five Lounge, a high-end restaurant and nightclub in Inglewood, prosecutors alleged. The money paid for its liquor license, architect, developer and upscale finishes, officials said.
“Taxpayers did not sign up to fund this nightclub,” Assistant Attorney General Colin McDonald said during a news conference Wednesday.
Young also allegedly spent nearly $50,000 on a trip to Tahiti and $140,000 restoring a vintage Chevrolet Impala. Other money went toward commercial real estate unrelated to homeless housing, prosecutors said.
LAHSA canceled its contracts with Home At Last in June.
“The scale and brazenness of these fraudsters expose a profound failure by the State of California and Los Angeles County to safeguard public funds,” said First Assistant United States Attorney Bill Essayli. “Millions intended to house the homeless allegedly financed private real estate, a nightclub, a bingo hall, and personal expenses. Taxpayers deserve accountability. We will follow the money, expose the corruption, and prosecute those who exploit the American people for personal gain.”
Malone faces 21 counts of conspiracy, wire fraud and bribery for allegedly accepting more than $180,000 from Alexander Soofer, the executive director of the nonprofit Abundant Blessings.
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In exchange, Malone allegedly gave Abundant Blessings priority access to homeless housing referrals, including “ghost” participants who never lived at the housing sites or received services.
Prosecutors said Malone helped create fake welcome letters, forged sign-in sheets and falsified eligibility forms that allowed Soofer to seek payment for services that were never provided.
Abundant Blessings received more than $17 million from Special Service for Groups during the alleged scheme, according to officials. Soofer, who was arrested in January, has agreed to plead guilty to wire fraud and money laundering.
Mitchell is charged with wire fraud for allegedly obtaining a grant for The Big Blue Umbrella by making false claims about its experience providing housing and mental health services.
The nonprofit sought more than $9 million from Epidaurus, which does business as Amity Foundation, and ultimately was awarded more than $1.2 million.
Mitchell allegedly misrepresented the nonprofit’s staffing and spending while using grant money for inflated salary payments, personal credit card debt, rent, transfers to relatives, PlayStation purchases and his own bail bond costs.
Amity ended the contract in May 2025 after disbursing about $315,000, prosecutors said. Mitchell was believed to be living in Las Vegas, First Assistant U.S. Attorney Bill Essayli said.
“When taxpayer-funded programs are exploited for personal gain, it undermines public trust and diverts critical resources away from the people who need them most,” Robert Molvar, acting assistant director in charge of the FBI’s Los Angeles Field Office, said in a statement.
Young and Malone were expected to appear Wednesday afternoon in federal court in downtown Los Angeles.
Young and Mitchell each face up to 20 years in federal prison if convicted. Malone faces up to 20 years for each wire fraud count, 10 years for each bribery count and five years for the conspiracy count.
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