Arrests made in crackdown of fraud, misuse of funds meant to combat Los Angeles homeless crisis

At least two people were arrested Wednesday for alleged fraud and misuse of millions of dollars in taxpayer money that was intended to combat the homelessness crisis in Los Angeles, officials announced.

ABC7 was in the Westmont area of South Los Angeles as federal agents surrounded a home on W. 98th Street and arrested one of the accused people, 48-year-old Lakiya Malone.

Federal investigators say Malone took more than $180,000 in bribes and kickbacks for signing up so-called "ghost participants." She allegedly provided referrals for participants - who were not actually homeless- at non-profit homeless housing facilities.

"She lied and she allowed known fraudsters to get credit for taking care of homeless people they weren't actually taking care of," said First Assistant U.S. Attorney Bill Essayli said. "This is all just a way to divert taxpayer dollars intended to help the homeless for the personal benefit of these fraudsters, and she was the enabler."

Meanwhile, the founder of the Culver City-based nonprofit Home At Last (HAL) was also arrested. Michael Young, 46, is accused of funneling millions in LAHSA funds and using that money for things such as private vacations and building a nightclub.



DEVELOPING: We will add more details to this report as they become available.