fraud

CALIFORNIA: Three people were charged by federal authorities in Los Angeles on Wednesday with stealing $12 million in federal and state homelessness aid to pay for real estate, luxury trips and vintage vehicles.

It was the second such arrest of people on federal fraud charges in Southern California this week, as President Donald Trump’s administration tries to emphasize a crackdown on fraud and waste in government and aid programs. On Tuesday, 12 people were charged with stealing more than $10 million in federal childcare aid.

The three defendants each worked for or ran Southern California-based nonprofit organizations, which often contracted with city, county, state or federal agencies to provide aid or money to find housing and social services for homeless people. Prosecutors allege that the defendants used funds from those contracts to pay personal expenses, accepted bribes, and billed for services that were never provided.

“Make no mistake, HUD and the Trump administration will not tolerate the theft and abuse of taxpayers in this country,” Secretary of Housing and Urban Development Scott Turner said at a news conference.

Turner used the indictments to accuse the Los Angeles Homeless Services Authority, which approved grants to these defendants, of being negligent with taxpayer dollars.

Taxpayer aid spent on video games, nightclubs

Two defendants, Lakiya Malone, 48, and Michael Young, 46, were arrested early Wednesday in Los Angeles. A third defendant charged with wire fraud, Donye Mitchell, 55, is considered a fugitive.

Young is the founder of Home At Last, a nonprofit that took in more than $118 million in public funds since 2019 for its stated mission of providing housing and aid to homeless people.

Federal prosecutors say Young instead created shell companies that he claimed were independent contractors but were, in fact, controlled by him. This alleged self-dealing allowed Young to be paid both at Home At Last and overbill federal and local authorities, prosecutors said. They say Young misused an estimated $7.5 million in taxpayer funds through fake contractors and vendors.

Young used the proceeds to take luxury trips to Tahiti, and used funds to open a nightclub in Inglewood called the Six Seven Five Lounge and other commercial real estate projects, prosecutors allege.

Mitchell is the CEO of Big Blue Umbrella, which was awarded more than $1.2 million from a federally supported nonprofit for housing and mental health care aid. Prosecutors say Mitchell not only misstated his organization’s ability to provide such services, but also used money from the award to pay off his credit card debts, give funds to family members, buy video games and pay legal expenses for an unrelated case.

Malone was charged with accepting more than $180,000 in bribes from another homelessness-aid nonprofit. Malone allegedly not only accepted bribes but also placed people in homeless aid programs who weren’t homeless.

Separately, federal prosecutors announced that a fourth person pleaded guilty to wire fraud and money laundering charges for stealing at least $2 million in homeless aid. Alexander Soofer, the executive director of Abundant Blessings, admitted to working with Malone to bill federal and state authorities for homelessness aid services when there were no participants in his programs.

Big money, little documentation

Some 72,000 to 75,000 people live in shelters or encampments in Los Angeles and Los Angeles County, making it one of the largest homeless populations in the country. It has been a significant issue in Southern California for years, and Los Angeles Mayor Karen Bass made it a cornerstone of her 2022 election campaign.

City and county authorities spend roughly $1 billion a year trying to help the homeless population, often using LAHSA to coordinate aid. While significant funds are spent to address the issue, city and county reviews have repeatedly found that the programs lacked appropriate recordkeeping, audit trails and documentation.

Nathan Hochman, the district attorney for Los Angeles County, told reporters that the public should expect more investigations and indictments into the misuse of homeless aid funds. Hochman’s office’s investigation into Soofer and Abundant Blessings led to his indictment earlier this year.

“I can assure this is the beginning of these prosecutions and we are far, far from the end,” he said, adding that his office’s investigation had found that the only “abundant blessings” Soofer provided were to his friends and family.

Some of the Trump administration’s efforts to go after fraud and abuse of government benefit programs have faced criticism and legal challenges. In December, Vice President JD Vance, who chairs the administration’s task force on the subject, amplified a YouTube video of a popular right-wing influencer accusing childcare providers in Minnesota, many of them immigrants from Somalia, of running scams. State authorities visited the centers and found nearly all of them operating normally.

Nonetheless, the administration launched a massive immigration crackdown in Minnesota. Officials later attempted to freeze federal funds for childcare in five Democratic-led states but were halted by a lawsuit.

WASHINGTON — The Supreme Court has blocked President Trump’s plan to restrict voting by mail, ruling it is too late to impose new postal service rules for the November election.

The justices on Monday turned down an emergency appeal from Trump’s lawyers, who argued the government needed a new and untested system of unique bar codes to track all the ballots of the tens of millions of people who vote by mail.

Instead, the justices left in place a judge’s order that prevents the U.S. Postal Service from enforcing the new rules for the midterm elections.

Concurring, Justice Brett M. Kavanaugh agreed it was too late to enforce the new rules for this election.

Justices Samuel A. Alito Jr. and Clarence Thomas dissented.

The decision in USPS vs. California is a victory for California Atty. Gen. Rob Bonta and the attorneys general for 22 other Democratic-led states who sued to block the new rules.

Last week, they warned there would be chaos and confusion if Trump’s rules were put in effect now.

Bonta cheered the decision late Monday, calling it “a victory for our democracy and a powerful affirmation of the rule of law” in a case where the stakes “could not have been higher.”

“Voting is the fundamental right from which all other rights flow, and all 50 states allow ballots to be cast by mail in some form. In California and several other states, mail voting is the primary way elections are conducted,” Bonta said. “Had this rule been allowed to take effect, the consequences would have been catastrophic.”

He said his office “will remain vigilant in safeguarding our elections,” and urged voters to make their voices heard.

Under the proposed rules, state and county election officials across the nation would be required to enroll each voter with a unique bar code and submit this data to a new online portal that, as of last week, was not yet functioning.

Without the individualized bar codes, states could not send ballots through the mail. In California, that would mean election officials would have to enroll 23 million voters with new bar codes before state ballots could be mailed.

“Compliance with the USPS’ rule would be impossible ahead of the midterms, meaning that millions of voters would be unable to vote by mail and some would not be able to vote at all,” the state attorneys general told the court last week.

The impact would not be limited to Democratic-leaning states. Utah Lt. Gov. Deidre Henderson said it would be “an unmitigated disaster” if the new rules were put into effect now. About 30% of the nation’s voters — and 80% of Californians — cast ballots by mail in 2024.

But Trump has maintained, without providing evidence, that voting by mail leads to widespread cheating and fraud.

In March, he issued an executive order that called on the postal service to do more to “enhance election integrity.”

“Unique ballot envelope identifiers, such as bar codes, enable confirmation that only citizens receive and cast ballots,” he said.

Elections experts say there is no evidence of such widespread fraud, despite robust audits and other searches for it.

State attorneys general argued that the Constitution entrusts states, not federal officials, to conduct elections. While Congress may impose new rules, it is not done to limit voting by mail or to empower the postal service to do so, they said.

Trump and his lawyers maintained the administration had a duty to combat fraud, including in elections.

Solicitor Gen. D. John Sauer described the new rules as “modest measures that will help prevent and restrain potential gross abuses of the mails to perpetrate a fraud on the Nation.”

And he said the federal government, the states and the voting public would face irreparable harm if the new Postal Service rules were not allowed to be applied to the coming election.

But U.S. District Judge Indira Talwani, in Boston, ruled the postal service may not put its new regulations into effect for the Nov. 3 election. She found the Trump administration had presented no evidence to the court of widespread fraud existing, while the states had presented ample evidence that implementing such a system on such a fast timeline posed tremendous risk.

The 1st Circuit Court affirmed her order and said the administration’s lawyers “have not even seriously challenged the … detailed findings about the chaos and widespread disenfranchisement that would occur between now and November 3 should the USPS rule take immediate effect.”

On Sunday, U.S. District Judge Carl Nichols — a Trump appointee — also blocked the new Postal Service rules from being implemented in separate cases brought by the NAACP and Democratic groups, finding they clearly exceeding the Postal Service’s authority in elections.

What the future will hold is unclear. The courts did not declare the new rules to be illegal or unconstitutional, though multiple lower courts have suggested that parts of the plan likely would be — including by exceeding the Postal Service’s authority to intervene in elections.

Much of the debate before the appellate and high court related to the rushed timeline under which the Postal Service was seeking to implement the changes. With that set aside by the Supreme Court’s ruling that the rules will not apply this election, the debate in the lower courts may shift focus to whether the new regulations can be applied to the 2028 elections.

Nevada Secretary of State Cisco Aguilar, chair of the Democratic Assn. of Secretaries of State, said the high court’s ruling was a clear loss for Trump, and that state election officials are ready to continue their fight to protect U.S. elections if necessary.

“This ruling affirms what our Constitution has always held: Elections belong to the American people, not a desperate man in Washington,” he said.

CAPE TOWN: The head organizer of the 2010 World Cup was re-elected president of South Africa’s soccer federation on Saturday despite facing criminal charges over alleged fraud while in office.

Danny Jordaan, 75, beat challenger Sandile Zungu, a South African businessman and soccer club owner, by 157 votes to 82, according to an announcement by the South African Football Association. Jordaan has been head of SAFA since 2013 and will serve a fourth term.

Jordaan was a pivotal figure in bringing the World Cup to Africa for the first time in 2010 and his work was praised in helping make the tournament a success.

But he has been followed by controversy since then.

He came under scrutiny in 2015 over if he had knowledge of an alleged $10 million bribe made by South Africa to a FIFA official to help win the 2010 hosting rights. The allegation against unidentified South African bid officials was contained in an indictment by the US Department of Justice. South Africa denied the allegation.

Jordaan was accused in 2017 of rape by South African singer and political activist Jennifer Ferguson, who said the rape happened more than two decades earlier. Jordaan denied that allegation, and charges against him were dropped because of a lack of evidence.

Jordaan was arrested in 2024 and charged with fraud and theft for the alleged misuse of around $70,000 while SAFA president. He was accused alongside several others, including a former acting CEO of SAFA and the chief financial officer of SAFA.

The charges accuse Jordaan of using SAFA money to hire personal security and a PR company to enhance his public image in the wake of the Ferguson rape allegations.

The fraud case has been bogged down by delays and is yet to go to trial. Jordaan and his co-accused denied wrongdoing.

The buildup to Saturday’s SAFA election was also troubled, with the national association saying some voting officials had received death threats and others had been harassed and intimidated. SAFA said it would notify the police but didn’t say who was behind the threats.

An aspiring Los Angeles-area rapper was arrested on Wednesday and charged in connection with a multimillion-dollar check-cashing scheme, according to the U.S. Department of Justice.

Ada William Obayuwana of Quartz Hill, who goes by “ColdheartedAC” and “AC,” and two others were charged in a 25-count federal grand jury indictment alleging that they illegally possessed more than 50 stolen U.S. Treasury checks and hundreds of other checks belonging to individuals and businesses worth more than $8.1 million, then cashed or attempted to cash them at lenders throughout Southern California.

Albert Tai Vu, of Westminster, and Cassandra Marie Murrillo, of San Diego, are the other two defendants charged in the case.

According to the indictment, between April 2022 and December 2023, the trio obtained the stolen checks, some containing tax refunds and veterans’ and Social Security Administration benefits, then forged endorsements or modified names and addresses to steal the money.

The trio is accused of opening bank accounts to receive the money. They also used business documents to impersonate the identities of the victims connected to the stolen checks and deposited the money into bank and credit union accounts across Los Angeles, Orange and San Diego counties, the indictment says.

During this period, Obayuwana allegedly tried to cash at least three Treasury tax refund checks worth $382,109 and was successful in cashing one, withdrawing $229,109, federal authorities allege.

In December 2023, Obayuwana “possessed in his car in Oceanside more than 100 stolen or fraudulent checks, cumulatively worth more than $6.1 million,” states the indictment. Among the checks were 48 stolen Treasury checks worth some $2,555,417 in tax refunds, veterans’ benefits,and Social Security benefits.

Obayuwana was able to cash eight of them worth about $1.7 million, according to federal investigators.

Vu tried to cash at least six Treasury checks totaling $2.15 million and successfully cashed two tax fund refunds worth $772,159, the indictment says. He also allegedly cashed a pair of cashier’s checks, each valued at $250,000, at an Anaheim bank and used money from one to buy a Range Rover and the second to pay Murillo.

Murillo is accused of trying to cash at least two checks worth $60,193, successfully cashing one for $31,405.

Following his arrest, Obayuwana remains in federal custody. He is charged with nine counts of bank fraud and faces three counts of delivering stolen Treasury checks and one count of aggravated identity theft.

Vu, who was arrested Thursday, is charged with five counts of delivering stolen Treasury checks, four counts of money laundering and two counts of aggravated identity theft.

Murillo, who is expected to surrender to federal authorities in Los Angeles on Monday, is charged with an additional count of delivering stolen Treasury checks.