A charity worker who allegedly took massive bribes in exchange for pouring millions of taxpayer dollars into the pockets of a corrupt homeless service bigwig was busted by the feds in a sweeping operation that targeted infamous homeless services fraud in that’s crippling Los Angeles.
FBI agents in a dramatic raid swarmed the South Los Angeles home of Lakiya Malone before dawn, pounding on her door and yelling for her to “come out!”
As the SSG worker emerged, she was placed in handcuffs by men in Kevlar vests, while others trained rifles on her house.
FBI agents collared Malone, 48, more than seven months after the federal government charged charity leader Alexander Soofer, 42, with stealing $23 million in public funds meant for the needy.
And while agents stuffed her into a silver sedan, other FBI men were hot on the trail of two other suspects caught up in a sweeping operation meant to root out fraud at the Los Angeles Homless Services Authority.
Top Los Angeles prosecutor Bill Essayli said the Homeless Fraud and Corruption Task Force he’s leading will stop at nothing to root out massive fraud at the lead agency that coordinates housing and social services for the homeless in Los Angeles County.
“We’re working our way up the chain. We’re getting to those who are enabling the fraud, and not just the fraudsters themselves.” he told the California Post. “The money went to enrich these fraudsters directly.”
“That’s where the taxpayer’s money is going — and it’s not going to the homeless,” he added.
The LAHSA has had recurring problems with corruption and late payments to nonprofit providers – things the Trump administration has named as its motivation for suspending federal funds to the joint city-county agency.
Malone is part of the problem, according to the feds.
She is charged in a 21-count federal indictment that accuses her of taking more than $180,000 in bribes and kickbacks from Soofer, the executive director of the homeless services nonprofit Abundant Blessings, who is separately charged in a massive fraud scheme and has agreed to plead guilty.
In exchange for the bribes and kickbacks, Malone allegedly provided priority referrals of homeless housing participants to Soofer’s organization, including “ghost” participants who never lived at the sites.
According to the indictment, Soofer paid her through checks made out to her and an entity she controlled, Grateful Hearts Realty & Consulting, disguising the payments as consulting fees.
In reality, the payments were tied to the number of referrals Malone sent and to “ghost clients” whose files she helped fabricate with fake welcome letters, forged sign in sheets, and falsified eligibility forms.
Soofer allegedly received more than $17 million from SSG during the scheme, inflated substantially by these fraudulent referrals.
Malone faces up to 20 years per wire fraud count, 10 years per bribery count, and five years on a conspiracy charge.
Soofer Soofer has agreed to plead guilty to one count of wire fraud and one count of money laundering.
He admitted in a plea agreement to his role in the bribery scheme with Malone.
He further admitted that he obtained $23 million in public money intended to combat homelessness, at least some of which he admits he obtained through fraud, pocketing at least $2 million in taxpayer money for his own personal enrichment and for businesses unrelated to homeless housing.
Soofer has agreed to forfeit his ill-gotten gains to the U.S. government and is expected to plead guilty to the felony charges in the coming weeks.
Federal agents on Wednesday also sought the capture of two other corrupt homeless services execs, including one who allegedly blew $12 million in taxpayer cash meant for the homeless on lavish toys including a bingo hall and a nightclub.
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