Our undercover journalist pressed California State Controller’s Press Secretary Bismarck Obando on why the office was not conducting more aggressive audits of these programs. His responses were eye-opening and captured on camera.
Obando admitted that proactive audits at the state agency level are minimal. He explained that while more staff would be needed, lawmakers have instead been cutting auditing teams. He even suggested that some in power “don’t want to find out what the deal is.”
When asked directly whether legitimate fraud exists in California’s homelessness spending, Obando replied: “Oh yeah, 100 percent.”
Obando acknowledged widespread overspending and a glaring lack of accountability, yet said the audits needed to expose it “are not getting done” because the office “just can’t conduct the audits” due to a lack of resources.
Even more striking: when questioned about the state’s plan to actually solve the homelessness crisis, Obando admitted there is “no statewide plan on homelessness.” Meanwhile, cities and counties are requesting another $1 billion this year simply to keep the same programs running.
OMG’s latest undercover footage and part four into our California’s homelessness investigation spending, we tracked nonprofits that have received tens of millions in public funding, only to find empty or severely underutilized infrastructure on the ground.
Abundant Blessings, a 501(c)(3) nonprofit based in Hyde Park, South Los Angeles, gained tax-exempt status with a stated mission “to end homelessness by providing short-term and long-term housing.” When our team visited to see that mission in action, the results were damning.
Just weeks after federal prosecutors arrested the group’s executive director, Alexander Soofer, on charges he fraudulently obtained over $23 million in public funds meant for homeless services. According to the U.S. Department of Justice, Soofer allegedly diverted at least $10 million to personal luxuries: a down payment on his $7 million Westwood home, a $125,000 Range Rover, private school tuition for his children, private jet travel, and stays at luxury resorts.
Soofer faces federal wire fraud charges under 18 U.S.C. § 1343, along with multiple California state felonies including conflict of interest, offering false evidence, and forgery.
Another major recipient is Urban Alchemy, a San Francisco-based 501(c)(3) operating across California. The organization has secured more than $60 million in government contracts overall, including over $12 million through LAHSA since 2021 for programs in Los Angeles.
In Los Angeles, Urban Alchemy claims to run mobile hygiene programs and “safe sleep villages” in Hollywood, Venice, and South Los Angeles. OMG visited all three sites and found empty tents, closed-off areas, and severely under-utilized facilities despite massive taxpayer investment and repeated contract extensions.
With hundreds of millions flowing into Los Angeles homelessness programs each year, basic services should not be this elusive. This is California’s homelessness system in practice: billions spent, nonprofits collecting tens of millions, one CEO arrested for allegedly stealing millions to fund a lavish lifestyle, vacant “safe sleep” sites, and the state’s own top communications official conceding that aggressive oversight is not happening while admitting fraud is rampant and there’s no real plan to fix the crisis.
OMG will continue tracking these stories, including developments from our cooperation with the Department of Justice on the Skid Row petition fraud cases.
If you have tips about waste, fraud, or abuse in these programs, contact us at [email protected] or (914) 491-9395.
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