Charity Worker Arrested in Major Fraud Case

A charity worker has been arrested for allegedly taking large bribes in exchange for directing taxpayer funds to a corrupt executive involved in homeless services, highlighting a significant fraud issue impacting Los Angeles.

FBI agents conducted a dramatic early morning raid on Lakiya Malone’s home in South Los Angeles, demanding her to “come out!”

As she stepped outside, agents handcuffed her, while others stood ready with rifles aimed at her house.

Malone, 48, was apprehended more than seven months after charity leader Alexander Soofer, 42, was charged with misappropriating $23 million intended for those in need.

During her arrest, other FBI agents were pursuing two additional suspects as part of an operation aimed at eliminating fraud within the Los Angeles Homeless Services Authority.

Bill Essayli, a leading prosecutor in Los Angeles, stated that the Homeless Fraud and Corruption Task Force is dedicated to uncovering extensive fraud at the agency responsible for managing housing and social services for the homeless in the area.

“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 a local news outlet. “The money went to enrich these fraudsters directly.”

He noted, “That’s where the taxpayer’s money is going — and it’s not going to the homeless.”

The LAHSA has faced continuous issues with corruption and delays in payments to nonprofit providers. Such concerns prompted the Trump administration to suspend federal funding to the agency.

Malone is implicated in this ongoing issue, facing a 21-count federal indictment that alleges she accepted over $180,000 in bribes and kickbacks from Soofer, who is involved in a significant fraud case and plans to plead guilty.

In exchange for these bribes, Malone reportedly offered preferential referrals of homeless individuals to Soofer’s organization, even fabricating “ghost” participants who never actually lived at the housing sites.

The indictment details that Soofer disguised payments to her—as checks issued in her name and to her company, Grateful Hearts Realty & Consulting—as consulting fees.

However, these payments were linked to the number of referrals Malone provided, including “ghost clients,” whom she helped create false documentation for, like welcome letters and forged eligibility forms.

Soofer is alleged to have received over $17 million due to these fraudulent referrals throughout the scheme.

Malone could face significant prison time, including up to 20 years for each wire fraud charge, 10 years for each bribery count, and five years on a conspiracy charge.

Meanwhile, Soofer is set to plead guilty to one count each of wire fraud and money laundering, admitting his complicity in the bribery scheme with Malone.

He acknowledged that he misappropriated $23 million in public funds meant to address homelessness, admitting to pocketing at least $2 million for personal expenses unrelated to homeless housing.

Soofer has agreed to forfeit his proceeds from the scheme to the U.S. government and will likely enter his guilty plea in the coming weeks.

On the same day, federal agents also sought to apprehend two more individuals involved in the corrupt practices within homeless services, including one who allegedly squandered $12 million of taxpayer money on extravagant purchases like a nightclub and a bingo hall.