White House steps in to stop LA fraud — it’s the only way

“For years American taxpayers have been sending billions to Los Angeles. The result? Fraud and corruption. That ends today.”

So said Scott Brady, executive director of the White House Fraud Task Force, chaired by Vice President JD Vance.

Brady announced that the federal government had cut off funding to the Los Angeles Homeless Services Authority (LAHSA), whose mismanagement has been legendary, even by local standards.

LAHSA has spent billions to solve the problem of homelessness in LA. Almost $1 billion of its funds have come from the federal government since 2021.

But a court-ordered audit last year found that LAHSA could not account for much of the money it had spent, and that there was even doubt about whether money was going toward homeless services at all.

Its CEO, Va Lecia Adams Kellum, resigned earlier this year after she was found to have awarded a $2.1 million contract to an organization where her husband happened to work.

The office of the inspector general at the Department of Housing and Urban Development (HUD) also looked into LAHSA earlier this year, finding that its federally funded “Continuum of Care” program “did not fully meet the goals and objectives of the program and did not always follow program requirements.” It also flagged nearly $900,000 in “salary and rent costs” that it said might not have been for the program.

Fox News reported Thursday that HUD had sent a letter to LAHSA informing it that the federal agency was suspending any more payments to LAHSA until the inspector general had conducted more investigations.

Critics have long been suspected that LAHSA is the center of the “homeless-industrial complex” — a system that profits off the homeless by taking public money and private donations to solve the problem, then failing to do so, and asking for more money, which the desperate public duly provides.

Homeless services organizations and activist groups also provide employment for political activists, who help stir up public support for politicians and political causes who are likely to keep the funds flowing.

This also means registering homeless people to vote, and making sure their ballots find their way in.

Sometime the fraud is exposed. Last year, two developers were arrested for allegedly using homeless grants to enrich themselves and maintain luxurious lifestyles.

The rot likely runs much, much deeper.

The larger story here is that the federal government is playing a crucial role — almost exclusively — in holding local government accountable.

State and local leaders have been incapable of rooting out the fraud. When they have acted — as when Attorney General Rob Bonta targeted hospice fraud — it is often after federal authorities have done so first.

California appears to be a closed political system, where there are elections but where the weakness of opposition, and the informal suppression of alternative views, mean political change almost never happens.

A one-party state has set in, which means there is almost no accountability for failure and corruption.

It becomes impossible to think outside the ruling paradigm — which is why LA County voters who complain about the cost of living nevertheless voted to raise their own sales taxes by 0.5% to pay for health services their tax money should already cover.

That is why some people have called for the appointment of a “special master” to oversee any funding that comes from the federal government for rebuilding after the LA wildfires.

And that is why the work of the White House Fraud Task Force is so important.

The good news is that JD Vance is on the case.

The bad news: there is so much more for them to do.

Joel Pollak is Opinion editor of the California Post.

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