# Los Angeles nonprofit financial fraud investigations

> Live situation record from CLSTR: https://clstr.news/situations/los-angeles-nonprofit-financial-fraud-investigations
> Updated: 2026-09-16T04:00:00.000Z. Sources: 9. Developments: 2.

Investigations into the use of public funds in Los Angeles have revealed significant financial irregularities and corruption within various nonprofit sectors. Initial scrutiny focused on the LA Opera, which received millions in government grants, and the Los Angeles Homeless Services Authority (LAHSA). In the latter case, prosecutors alleged that Alex Soofer, former leader of the nonprofit Abundant Blessings, diverted at least $10 million intended for homelessness services to fund personal luxuries. Federal auditors noted that LAHSA delayed notifying federal funders of potential crimes for approximately eight months.

The situation escalated with federal authorities conducting coordinated raids and arrests targeting a broader network of fraud within the LAHSA system. Michael Young, founder of Home At Last, was charged with wire fraud for allegedly embezzling over $7.5 million, including funds used to open a nightclub. Other legal actions included the arrest of Lakiya Malone for allegedly accepting bribes from Soofer to provide priority housing for ‘ghost’ clients, and wire fraud charges against Donye Mitchell, CEO of The Big Blue Umbrella, for the alleged misappropriation of $1.2 million in public grants.

## Claims

- Michael Young is charged with wire fraud for allegedly embezzling more than $7.5 million from public contracts. (corroborated by 4 sources)
- Lakiya Malone allegedly accepted over $180,000 in bribes and kickbacks from Alexander Soofer. (corroborated by 3 sources)
- Alexander Soofer has agreed to plead guilty to wire fraud and money laundering. (corroborated by 3 sources)
- Donye Mitchell is charged with wire fraud for allegedly obtaining $1.2 million in public grant funding for personal use. (corroborated by 2 sources)
- The fraud scheme utilized 'ghost' participants who did not reside at the housing sites to inflate referral numbers. (corroborated by 2 sources)
- Michael Young allegedly used over $1 million of misappropriated funds to open the Six Seven Five Lounge in Inglewood. (single source)

## Timeline

### 2026-09-16: Los Angeles nonprofit workers arrested in multi-million dollar homelessness fraud scheme

Federal agents arrested multiple Los Angeles nonprofit workers for allegedly stealing millions in taxpayer funds meant for homeless services to fund luxury lifestyles, nightclubs, and personal expenses.

6 sources. https://clstr.news/cluster/federal-agents-arrest-lakiya-malone-in-los-angeles-homeless-aid-fraud-probe

### 2026-09-09: Los Angeles nonprofit spending faces scrutiny over public funds

Investigations in Los Angeles reveal misuse of public funds, including high executive pay at LA Opera and alleged fraud involving $10 million in homelessness grants at Abundant Blessings.

3 sources. https://clstr.news/cluster/los-angeles-nonprofit-spending-faces-scrutiny-over-public-funds

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Cite as: Los Angeles nonprofit financial fraud investigations. CLSTR, https://clstr.news/situations/los-angeles-nonprofit-financial-fraud-investigations