{"id":10392,"date":"2025-10-17T21:38:52","date_gmt":"2025-10-18T05:38:52","guid":{"rendered":"http:\/\/inedc.com\/24\/?p=10392"},"modified":"2025-10-17T21:38:52","modified_gmt":"2025-10-18T05:38:52","slug":"feds-charge-two-in-alleged-fraud-linked-to-californias-homekey-program","status":"publish","type":"post","link":"http:\/\/inedc.com\/24\/government\/feds-charge-two-in-alleged-fraud-linked-to-californias-homekey-program\/","title":{"rendered":"Feds Charge Two in Alleged Fraud Linked to California\u2019s Homekey Program"},"content":{"rendered":"<h1 data-start=\"0\" data-end=\"119\">Feds Charge Two in Alleged Fraud Tied to California\u2019s Homekey Program; Local Officials Urged to Watch Grant Oversight<\/h1>\n<p data-start=\"121\" data-end=\"596\">By Cris Alarcon<br data-start=\"136\" data-end=\"139\" \/>Placerville \u2014 The U.S. Department of Justice on Thursday announced criminal charges in two separate cases alleging fraud and misuse of public funds intended to create housing for people experiencing homelessness \u2014 including grants awarded under <a href=\"https:\/\/www.inedc.com\/22\/05\/04\/el-dorado-county-supervisor-candidate-q-a-kenny-curtzwiler\/\">California\u2019s Homekey program<\/a>. Federal prosecutors said the cases underscore growing scrutiny of homelessness funding statewide and warned more enforcement actions may follow.<\/p>\n<h2 data-start=\"598\" data-end=\"623\">Key facts and timeline<\/h2>\n<ul data-start=\"624\" data-end=\"1887\">\n<li data-start=\"624\" data-end=\"964\">\n<p data-start=\"626\" data-end=\"964\">Federal authorities filed charges this week against <strong data-start=\"678\" data-end=\"693\">Cody Holmes<\/strong>, a former chief financial officer for an affordable-housing developer, and <strong data-start=\"769\" data-end=\"786\">Steven Taylor<\/strong>, a real-estate investor, in separate but related probes of public homelessness funding. Holmes was arrested Thursday; Taylor was charged.<\/p>\n<\/li>\n<li data-start=\"965\" data-end=\"1331\">\n<p data-start=\"967\" data-end=\"1331\">Prosecutors allege Holmes submitted fabricated bank records and false financial statements to the California Department of Housing and Community Development (HCD) to help secure a <strong data-start=\"1147\" data-end=\"1178\">$25.9 million Homekey award<\/strong> for a Thousand Oaks project; federal officials say some of those funds were later diverted to personal expenses.<\/p>\n<\/li>\n<li data-start=\"1332\" data-end=\"1604\">\n<p data-start=\"1334\" data-end=\"1604\">In the Taylor case, prosecutors allege bank fraud, identity theft and money-laundering tied to real-estate flips in Los Angeles, including transactions involving properties sold to organizations tied to homeless-services projects.<\/p>\n<\/li>\n<li data-start=\"1605\" data-end=\"1887\">\n<p data-start=\"1607\" data-end=\"1887\">The U.S. Attorney\u2019s Office for the Central District of California stressed the work is part of a broader effort \u2014 the <strong data-start=\"1725\" data-end=\"1771\">Homelessness Fraud &amp; Corruption Task Force<\/strong> \u2014 to investigate misuse of billions in homelessness relief and housing funds.<\/p>\n<\/li>\n<\/ul>\n<h2 data-start=\"1889\" data-end=\"1909\">What the DOJ said<\/h2>\n<p data-start=\"1910\" data-end=\"2348\">Acting U.S. Attorney Bill Essayli framed the indictments as a warning to would-be fraudsters. \u201cAccountability for the misuse of billions of tax dollars intended to combat homelessness starts today,\u201d federal officials said in announcing the charges. The DOJ release details how allegedly falsified documents and sham transactions were used to obtain grants and loans tied to homeless-housing projects. <span class=\"\" data-state=\"closed\"><span class=\"ms-1 inline-flex max-w-full items-center relative top-[-0.094rem] animate-[show_150ms_ease-in]\" data-testid=\"webpage-citation-pill\"><a class=\"flex h-4.5 overflow-hidden rounded-xl px-2 text-[9px] font-medium transition-colors duration-150 ease-in-out text-token-text-secondary! bg-[#F4F4F4]! dark:bg-[#303030]!\" href=\"https:\/\/www.justice.gov\/usao-cdca\/pr\/beverly-hills-man-arrested-brentwood-man-charged-separate-criminal-cases-linked-fraud?utm_source=chatgpt.com\" target=\"_blank\" rel=\"noopener\"><span class=\"relative start-0 bottom-0 flex h-full w-full items-center\"><span class=\"flex h-4 w-full items-center justify-between overflow-hidden\"><span class=\"max-w-[15ch] grow truncate overflow-hidden text-center\">Justice Department<\/span><\/span><\/span><\/a><\/span><\/span><\/p>\n<h2 data-start=\"2350\" data-end=\"2390\">Why this matters for El Dorado County<\/h2>\n<p data-start=\"2391\" data-end=\"2845\">El Dorado County has participated in Homekey and related programs \u2014 most notably in South Lake Tahoe, where nonprofit operators converted several motels into housing to shelter people through winter and into longer-term supportive housing. That experience illustrates both the rapid impact and fiscal complexity of Homekey projects, which move large sums quickly and require ongoing operations funding and oversight.<\/p>\n<p data-start=\"2847\" data-end=\"3475\">Local officials and service providers here salute the benefits of Homekey conversions but say the new federal actions are a reminder that strong local controls and transparent bookkeeping are essential. \u201cWhen millions of dollars are moving fast, the public has a right to expect clear accounting and robust oversight,\u201d said a county housing official reached through the county\u2019s Housing &amp; Homelessness Services contact line. (El Dorado County maintains a local front door at <a class=\"decorated-link cursor-pointer\" rel=\"noopener\" data-start=\"3322\" data-end=\"3349\">homeless.services@edcgov.us<\/a> and a partnership with Tahoe Coalition for the Homeless for South Lake Tahoe programs.) <span class=\"\" data-state=\"closed\"><span class=\"ms-1 inline-flex max-w-full items-center relative top-[-0.094rem] animate-[show_150ms_ease-in]\" data-testid=\"webpage-citation-pill\"><a class=\"flex h-4.5 overflow-hidden rounded-xl px-2 text-[9px] font-medium transition-colors duration-150 ease-in-out text-token-text-secondary! bg-[#F4F4F4]! dark:bg-[#303030]!\" href=\"https:\/\/www.cityofslt.gov\/1056\/Community-Resources?utm_source=chatgpt.com\" target=\"_blank\" rel=\"noopener\"><span class=\"relative start-0 bottom-0 flex h-full w-full items-center\"><span class=\"flex h-4 w-full items-center justify-between\"><span class=\"max-w-[15ch] grow truncate overflow-hidden text-center\">City of South Lake Tahoe<\/span><span class=\"-me-1 flex h-full items-center rounded-full px-1 text-[#8F8F8F]\">+1\u00a0<\/span><\/span><\/span><\/a><\/span><\/span><\/p>\n<p data-start=\"2847\" data-end=\"3475\">&#8220;In El Dorado County, a west slope PRK project has operated through a hotel in Pollock Pines since April 2020. Though its intent was to respond to COVID-19, PRK has successfully served as a pathway to exiting homelessness for residents.&#8221; &#8211; <a href=\"https:\/\/www.mtdemocrat.com\/opinion\/guest-column-project-roomkey-the-homekey-program-and-potential-next-steps-in-pollock-pines\/article_1a91b445-e18d-5350-9296-6e02cbb5f119.html\">the Democrat Dec 1, 2021<\/a><\/p>\n<p data-start=\"3547\" data-end=\"4135\">Homekey was designed to deploy state funds rapidly \u2014 acquiring motels, hostels and other properties and converting them into interim or permanent housing \u2014 and often paired capital awards with short expenditure timelines and required operating plans. HCD\u2019s guidance notes strict deadlines for capital and operating spending and long affordability covenants for permanent supportive housing. Those program features help accelerate housing creation but can place a premium on accurate financial documentation and strong local capacity to manage awards.<\/p>\n<div class=\"text-token-text-primary border-token-border-default bg-token-main-surface-primary\/10 flex items-center gap-6 rounded-2xl border text-sm px-3 py-2.5 md:p-4 mb-2 w-fit max-w-full self-start\">\n<div class=\"flex min-w-0 grow gap-3 items-center\">\n<div class=\"min-w-0 grow pt-[2px]\">\n<div class=\"flex flex-row items-center justify-between gap-4\">\n<div class=\"min-w-0 text-pretty break-words whitespace-pre-wrap\">\n<div class=\"markdown break-words [&amp;&gt;:last-child]:mb-0\">\n<p>&nbsp;<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<h2 data-start=\"4137\" data-end=\"4169\">Local reaction<\/h2>\n<ul data-start=\"4170\" data-end=\"5312\">\n<li data-start=\"4170\" data-end=\"4612\">\n<p data-start=\"4172\" data-end=\"4612\"><strong data-start=\"4172\" data-end=\"4193\">County oversight:<\/strong> County supervisors and housing staff should review existing Homekey contracts and internal controls; legal and accounting reviews are prudent when large capital awards are involved. El Dorado County\u2019s Health and Human Services Department handles homelessness referrals and coordination for the county and could consider voluntary audits or increased reporting for future awards.<\/p>\n<\/li>\n<li data-start=\"4613\" data-end=\"4978\">\n<p data-start=\"4615\" data-end=\"4978\"><strong data-start=\"4615\" data-end=\"4642\">Providers &amp; nonprofits:<\/strong> Local providers such as the Tahoe Coalition for the Homeless said Homekey projects in South Lake Tahoe have housed dozens of residents and remain vital to winter sheltering and longer-term placement \u2014 but providers also need stable operating funds and transparent accounting to maintain trust.<\/p>\n<\/li>\n<li data-start=\"4979\" data-end=\"5312\">\n<p data-start=\"4981\" data-end=\"5312\"><strong data-start=\"4981\" data-end=\"4998\">Public trust:<\/strong> The DOJ\u2019s emphasis on a task force suggests federal investigators will pursue similar cases where evidence of misrepresentation or diversion exists. Local stakeholders \u2014 elected officials, service providers and taxpayers \u2014 should demand transparency in contracts and prompt reporting on how state funds are spent.<\/p>\n<\/li>\n<\/ul>\n<p>Federal prosecutors this week charged two men in separate cases alleging fraud connected to homelessness funding, including a Homekey grant. The DOJ said falsified financial records and diverted funds were used to secure awards and loans. El Dorado County officials and local providers say the cases underscore the need for strict oversight of rapidly deployed housing funds. Federal authorities have signaled the investigations are likely to continue.<\/p>\n<ul>\n<li data-start=\"1986\" data-end=\"2112\">\n<p data-start=\"1988\" data-end=\"2112\">The case underscores the risk of fraud in large, rapid\u2010disbursement social programs with substantial oversight challenges.<\/p>\n<\/li>\n<li data-start=\"2113\" data-end=\"2254\">\n<p data-start=\"2115\" data-end=\"2254\">It also highlights how real estate developers and housing intermediaries can become focal points in investigations of homelessness funds.<\/p>\n<\/li>\n<li data-start=\"2255\" data-end=\"2508\">\n<p data-start=\"2257\" data-end=\"2508\">Given the DOJ\u2019s strong statements (e.g. \u201cAccountability for the misuse of billions of tax dollars intended to combat homelessness starts today\u201d) it\u2019s likely federal agencies will pursue further cases and audits.<\/p>\n<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<h1 data-start=\"2007\" data-end=\"2054\">How Homekey has been used in El Dorado County<\/h1>\n<ul data-start=\"2055\" data-end=\"3594\">\n<li data-start=\"2055\" data-end=\"2597\">\n<p data-start=\"2057\" data-end=\"2597\"><strong data-start=\"2057\" data-end=\"2121\">South Lake Tahoe \u2014 motel\/hotel acquisitions and conversions:<\/strong> Tahoe Coalition for the Homeless used Homekey funding to purchase and convert multiple motels\/lodges near the \u201cY\u201d \/ Emerald Bay area into long-term housing units for formerly homeless residents. Local reporting states purchases in late 2020 and gradual conversion\/rehab to house dozens of people (reporting mentioned 40 people housed with plans to expand toward ~60). The South Lake Tahoe Homekey work was part of early Homekey awards.<\/p>\n<\/li>\n<li data-start=\"2598\" data-end=\"2859\">\n<p data-start=\"2600\" data-end=\"2859\"><strong data-start=\"2600\" data-end=\"2648\">Specific El Dorado Homekey property mention:<\/strong> State-level Homekey project lists \/ case study documents reference an El Dorado County site at <strong data-start=\"2744\" data-end=\"2769\">1137 Emerald Bay Road<\/strong> (South Lake Tahoe) as a Homekey project location.<strong data-start=\"2862\" data-end=\"2901\">County services &amp; local navigation:<\/strong> El Dorado County operates a Navigation Center (60-bed, referral-only shelter) and has a county Front Door for homelessness services (phone and referrals). Those county systems are the local entry points for people who might be referred to Homekey-funded housing.<\/p>\n<\/li>\n<li data-start=\"3205\" data-end=\"3594\">\n<p data-start=\"3207\" data-end=\"3594\"><strong data-start=\"3207\" data-end=\"3247\">Other local affordable developments:<\/strong> Separately (but related to county housing capacity), Mercy Housing and partners broke ground on <strong data-start=\"3344\" data-end=\"3363\">El Dorado Haven<\/strong> (65 affordable units, 15 reserved for veterans\/formerly homeless) \u2014 an example of local affordable housing activity that complements Homekey conversions (may be funded from different sources).<\/p>\n<\/li>\n<\/ul>\n<p><strong data-start=\"4857\" data-end=\"4907\">El Dorado County \u2013 Housing &amp; Homelessness page<\/strong> \u2014 local Navigation Center, \u201cFront Door\u201d phone for referrals: <strong data-start=\"4969\" data-end=\"4987\">(530) 600-2822<\/strong>. Useful if you want to refer someone locally or check current local shelter\/housing capacity.<\/p>\n<h2 data-start=\"622\" data-end=\"661\">What the records show<\/h2>\n<ul data-start=\"662\" data-end=\"795\" data-is-last-node=\"\" data-is-only-node=\"\">\n<li data-start=\"662\" data-end=\"795\" data-is-last-node=\"\">\n<p data-start=\"664\" data-end=\"795\" data-is-last-node=\"\">On Jan. 4, 2022, the Board of Supervisors considered <strong data-start=\"717\" data-end=\"733\">File 22-0075<\/strong>, an item asking staff to discontinue pursuing the <strong data-start=\"784\" data-end=\"795\" data-is-last-node=\"\">Homekey.<\/strong><\/p>\n<\/li>\n<li data-start=\"662\" data-end=\"795\" data-is-last-node=\"\">A review of El Dorado County Board of Supervisors meeting records and procurement filings shows the county <strong data-start=\"275\" data-end=\"355\">did not complete a Homekey purchase of the Best Western Inn in Pollock Pines<\/strong> and instead voted to halt pursuit of the application in January 2022 \u2014 but the county\u2019s contracts with local homeless-service providers and Homekey activity in South Lake Tahoe remain fertile ground for reporters and auditors.<\/li>\n<\/ul>\n<h3 data-start=\"5762\" data-end=\"5773\">Sources<\/h3>\n<p data-start=\"5774\" data-end=\"6025\">U.S. Department of Justice press release; Los Angeles Times; KSBW; ABC7 Los Angeles; HCD Homekey guidance and awards dashboard; Tahoe Coalition for the Homeless; El Dorado County Housing &amp; Homelessness Services.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Federal charges allege millions in homeless-housing grants were obtained with false documents. County leaders say transparency and audits are essential.<\/p>\n","protected":false},"author":1,"featured_media":10393,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jnews-multi-image_gallery":[],"jnews_single_post":{"format":"standard","override":[{"template":"7","parallax":"1","layout":"no-sidebar-narrow","sidebar":"default-sidebar","second_sidebar":"default-sidebar","sticky_sidebar":"1","share_position":"float","share_float_style":"share-normal","show_share_counter":"1","show_view_counter":"1","show_featured":"1","show_post_meta":"1","show_post_author":"1","show_post_author_image":"1","show_post_date":"1","post_date_format":"default","post_date_format_custom":"Y\/m\/d","show_post_category":"1","post_reading_time_wpm":"300","post_calculate_word_method":"str_word_count","show_zoom_button":"0","zoom_button_out_step":"2","zoom_button_in_step":"3","show_post_tag":"1","show_popup_post":"1","show_comment_section":"1","number_popup_post":"1","show_author_box":"1","show_post_related":"1","show_inline_post_related":"1"}],"image_override":[{"single_post_thumbnail_size":"crop-500","single_post_gallery_size":"crop-500"}],"trending_post_position":"meta","trending_post_label":"Trending","sponsored_post_label":"Sponsored by","disable_ad":"0","subtitle":"Arrests heighten scrutiny of homelessness funding as local officials weigh oversight steps"},"jnews_primary_category":[],"jnews_social_meta":[],"jnews_override_counter":{"view_counter_number":"0","share_counter_number":"0","like_counter_number":"0","dislike_counter_number":"0"},"footnotes":""},"categories":[25,5],"tags":[],"class_list":["post-10392","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-crime","category-government"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Feds Charge Two in Alleged Fraud Linked to California\u2019s Homekey Program - Placerville NewsWire<\/title>\n<meta name=\"description\" content=\"DOJ charges two in alleged fraud tied to California\u2019s Homekey grants; 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