HUD suspends federal funding to Los Angeles Homeless Services Authority

The U.S. Department of Housing and Urban Development (HUD) announced an immediate suspension of all federal funding to the Los Angeles Homeless Services Authority (LAHSA). The action follows a White House fraud task‑force investigation, co‑chaired by Vice President JD Vance, and a HUD Inspector General review that cited “obvious fraud” and “wanton mismanagement.”

HUD officials said the agency failed to track spending, could not verify thousands of housing sites, and allowed conflicts of interest, including a former executive directing $2.1 million to her husband’s nonprofit. The agency also left $513 million of its 2024 budget unspent. Nearly $200 million in Continuum of Care aid – part of almost $1 billion in federal funds received since 2021 – is now at risk.

LAHSA officials claim the suspension will jeopardize services for thousands of formerly homeless people and assert they are fixing internal controls, modernising financial systems and seeking ways to keep federal dollars flowing. Los Angeles Mayor Karen Bass and County Supervisor Lindsey Horvath warned that cutting funding could reverse recent gains in reducing homelessness.

HUD Secretary Scott Turner emphasized that taxpayers will no longer “bankroll an organization that puts its own self‑interests ahead of the Americans it was created to serve.” The suspension will remain until the Inspector General’s investigation is completed or LAHSA requests a hearing.