The Department of Justice said it will form a task force to investigate “fraud, waste, abuse, and corruption.” Conan Nolan reports for the NBC4 News at 5 p.m. on Tuesday, April 8, 2025.
The Department of Justice will form a task force to investigate "fraud, waste, abuse, and corruption" involving the use of funds to combat homelessness in Southern California, the agency announced Tuesday.
The Homelessness Fraud and Corruption Task Force will include federal prosecutors from the Major Frauds Section, the Public Corruption and Civil Rights Section, and the Civil Division’s Civil Fraud Section of the United States Attorney’s Office for the Central District of California, the DOJ said in a news release.
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The task force will investigate the use of funds in counties within the jurisdiction of the Central District of California, which includes Los Angeles, Orange, Riverside, San Bernardino, San Luis Obispo, Santa Barbara, and Ventura counties.
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SIGN UP "California has spent more than $24 billion over the past five years to address homelessness," said United States Attorney Bill Essayli. "But officials have been unable to account for all the expenditures and outcomes, and the homeless crisis has only gotten worse. Taxpayers deserve answers for where and how their hard-earned money has been spent. If state and local officials cannot provide proper oversight and accountability, we will do it for them. If we discover any federal laws were violated, we will make arrests."
Essayli was sworn in April 2 as the U.S. Attorney for the Central District of California following his appointment by Attorney General Pam Bondi. Prior to that he was as a twice-elected member of the state Assembly.
Mayor Karen Bass was asked Tuesday about the new task force.
"I'm not opposed to the task force, but I don't want it to be a fishing expedition," Bass said. "I don't want it to be a distraction that takes us away from what our primary mission is."
The investigation will include how money has been used from voter-approved ballot initiatives that provided funds for homeless programs and services. No evidence of wrongdoing was presented, but authorities said arrests are possible if federal laws were violated.
"Despite voter-approved initiatives and billions of dollars spent on tackling this issue, homelessness remains a crisis, especially in Los Angeles County," the DOJ said in its announcement. "Last month, a court-ordered audit found that homelessness services provided by the city and county of Los Angeles were 'disjointed' and contained 'poor data quality and integration' and lacked financial controls to monitor contracts for compliance and performance."
Last week, the Los Angeles County Board of Supervisors voted to effectively pull out of the Los Angeles Homeless Services Authority (LAHSA). The city and county have been sending tax revenue to the agency to administer efforts to end homelessness.
The county's move came after audits indicated a lack of transparency in the financial accounting of services provided. The county board voted to set up the county’s own homeless services department, a decision that was met by opposition from Los Angeles city officials.
The county's vote came on the day the countywide sales tax increased by a quarter-cent to provide additional funding for anti-homelessness programs. The increase was approved by voters in November with passage of Measure A, a half-cent sales tax for homeless programs that will be in effect in perpetuity. The tax replaced a previous voter-approved quarter-cent sales tax that was set to expire in 2027.
Gov. Gavin Newsom issued a statement about the investigation.
"Local governments must use state and federal homelessness dollars responsibly — and we expect them to deliver results," Newsom said. "We share the federal administration’s goal of ensuring taxpayer funds are being used effectively to get people off our streets."
