Federal authorities in Los Angeles have announced two separate criminal cases involving alleged fraud related to public funds intended for homelessness projects. The former chief financial officer of a downtown Los Angeles-based affordable housing developer has been arrested, and a Brentwood man faces charges connected to fraudulent activities in his property-flipping business.
Acting United States Attorney Bill Essayli stated, “Accountability for the misuse of billions of tax dollars intended to combat homeless starts today. The two criminal cases announced is only the tip of the iceberg and we intend to aggressively pursue all leads and hold anyone who broke any federal laws criminally liable.”
Akil Davis, Assistant Director of the FBI's Los Angeles Field Office, commented, “In both of these cases, defendants took advantage of funds allocated to assist the homeless, some of the most vulnerable people in society and many of whom may be suffering from myriad conditions, including addiction. The FBI is committed to the Homelessness Fraud & Corruption Task Force to find perpetrators of this insidious fraud and build cases to hold the offenders accountable in court. It is my hope that the charges we’re announcing today send a message to others who may be contemplating similar criminal behavior.”
Special Agent in Charge Tyler Hatcher from IRS Criminal Investigation’s Los Angeles Field Office said, “IRS-CI is proud to be an inaugural member of the Homelessness Fraud and Corruption Task Force, which was formed to ensure that funds which were committed to aiding California’s homeless population were spent as intended. Today’s actions show our commitment to ensuring the public that we will investigate missing funds that were intended to benefit some of the most vulnerable Californians.”
Herminia Neblina, Special Agent in Charge at FHFA-OIG Western Region, added: “The Federal Housing Finance Agency Office of Inspector General (FHFA-OIG) thoroughly investigates allegations of fraud, waste, and abuse. We will continue to hold those accountable who engage in fraud against the entities that FHFA regulates. This investigation reflects our commitment to coordinating investigations with our law enforcement partners.”
In one case, Cody Holmes, 31, from Beverly Hills was arrested on a federal complaint charging him with mail fraud. Prosecutors allege that Holmes submitted fake bank records while serving as CFO for Shangri-La Industries LLC—an affordable housing developer—to secure state grant money meant for homeless housing projects under California’s Homekey program. Authorities say Holmes provided false documentation showing $160 million supposedly held by Shangri-La or its affiliates when such accounts did not exist.
The affidavit claims Holmes also submitted balance sheets falsely representing millions in cash holdings by affiliated entities. Based on these documents, California’s Department of Housing and Community Development (HCD) released additional grant funding for projects including one in Thousand Oaks. Some grant money allegedly paid credit card bills associated with Holmes; over $2 million reportedly went toward American Express cards with luxury retailer purchases between November 2022 and May 2023.
Holmes faces up to 20 years in federal prison if convicted.
In a separate indictment, Steven Taylor, 44, from Brentwood faces seven counts of bank fraud along with charges for aggravated identity theft and money laundering. According to prosecutors, Taylor used fake bank statements and misrepresented cash assets from August 2019 through July 2025 to obtain loans and lines of credit for his real estate business across several Los Angeles neighborhoods.
Authorities allege Taylor lied about his intentions when acquiring properties—including a Cheviot Hills home he bought using fraudulent loans for $11.2 million before selling it via double escrow for $27.3 million using public funds earmarked for homeless housing development by city and state agencies.
Taylor also allegedly maintained multiple unsecured lines of credit using false information—obtaining $3 million from one lender while keeping open another $1 million line despite telling lenders otherwise—and forged communications regarding account closures.
If convicted on all counts, Taylor could face up to 30 years per bank fraud charge plus additional time for money laundering and identity theft offenses.
Both investigations are being conducted by teams from the FBI; IRS Criminal Investigation; and—for Taylor—the Federal Housing Finance Agency Office of Inspector General as well.
Assistant United States Attorneys Monica E. Tait and Nisha Chandran (Major Frauds Section) along with Sarah E. Spielberger (Asset Forfeiture and Recovery Section) are prosecuting Holmes’ case; Kerry L. Quinn (Major Frauds), Juan M. Rodriguez (Public Corruption/Civil Rights), and Sarah E. Spielberger are prosecuting Taylor’s case.
All defendants are presumed innocent until proven guilty beyond a reasonable doubt in court.
