Arrests Made in Scheme Misusing Homeless Funds
Two developers in Los Angeles have been arrested in unrelated incidents for allegedly misappropriating millions in grants intended for homeless assistance. Intriguingly, the foundation of former Democratic state senator Kevin Murray has surfaced in connection with these allegations, as prosecutors revealed on Thursday.
Steven Taylor, a 44-year-old real estate flipper, was arrested for allegedly submitting false financial statements to secure loans and misleadingly claiming how he would utilize a property in Cheviot Hills, which he sold to Murray’s nonprofit, Weingart Center, for a staggering $27.3 million. Los Angeles U.S. Attorney Bill Esseri provided these details during a Thursday announcement.
The funds from the city and the state Housing Development Authority were allegedly meant to enable homeless individuals to purchase Taylor’s property shortly after its acquisition.
Originally, the facility was designated for elderly residents, according to reports.
While Murray has not been charged in this case, his nonprofit’s activities remain a focus of the ongoing investigation.
Esseri asserted that the investigation will not shy away from prosecuting any politicians found to have misused these funds, emphasizing that Thursday’s arrests mark “just the beginning.” He cautioned, “We’re watching everyone.”
Taylor, a resident of Brentwood, is accused of defrauding lenders through false bank statements to fund his real estate flipping endeavors. Allegedly, he misrepresented his intentions regarding a loan application for the Cheviot Hills property, claiming renovation and personal residency plans. Rather than following through, he sold the property shortly after purchase for $16 million more than what he initially paid to Murray.
On the same day, Cody Holmes faced charges in a separate case involving the misappropriation of homeless housing grants to finance luxury purchases and pay credit card bills. Holmes, aged 31, previously served as finance director for Shangri-La Industries LLC, which received $25.9 million in funding for homeless housing projects in Thousand Oaks. Esseri contended that Holmes diverted some of this money for personal use.
While Holmes was initially noted for securing millions in grants for building homeless housing across various California cities, the federal government alleges that he submitted fraudulent bank records indicating that his company possessed $160 million in assets—assets that, in reality, did not exist.
According to officials, Holmes transferred $2.2 million into a personal account and utilized around $2 million for American Express bills, purportedly linked to purchases from a noted luxury retailer.
If convicted, Holmes could be looking at up to 20 years in prison, whereas Taylor faces a potential 30-year sentence. A court appearance for Holmes was scheduled for Thursday, while Taylor is expected in court within the next few weeks.
Neither Murray nor Weingart provided immediate comments regarding the situation. It remains unclear who represents Taylor and Holmes in these matters.
