In a stunning turn of events, Essayli has reported two consequential arrests tied to a staggering misuse of public funds meant to combat homelessness.
NBC News in Los Angeles delivers the grim details:
Two Los Angeles Men Charged with Defrauding Public Funds Intended for Homelessness Relief
Federal prosecutors have moved against two men from the Los Angeles area, each facing serious charges for misappropriating funds allocated for addressing homelessness and constructing affordable housing, as disclosed by the Department of Justice (DOJ) on Thursday.
Cody Holmes, a Beverly Hills resident, found himself in custody after allegedly fabricating bank documents to secure nearly $26 million from the California Department of Housing and Community Development (HCD) for Shangri-La Industries LLC, where he previously served as CFO. These funds, earmarked for the Project Homekey initiative to build affordable housing in Thousand Oaks, were reportedly diverted by Holmes for personal luxuries, including credit card payments and extravagant retail purchases. “The developer received full funding from the state, yet construction on the Thousand Oaks project was never finished,” Acting U.S. Attorney Bill Essayli stated at a press briefing. “In essence, he stole that money.”
Watch the video below:
BREAKING: In a sensational expose, US Attorney Bill Essayli has revealed that California Democratic officials presided over a monumental scandal regarding homelessness funding misuse.
This has yielded MILLIONS in fraudulent expenditures.
“Billions of California taxpayer dollars intended to solve… pic.twitter.com/rIN9uMVJlF
— Eric Daugherty (@EricLDaugh) October 16, 2025
In his own words, Essayli stated:
California has allocated billions in taxpayer resources to tackle its homelessness crisis, yet the results are alarmingly unsatisfactory. Six months ago, I unveiled the Homelessness Fraud and Corruption Task Force. Today, we take steps toward accountability by announcing two distinct cases involving over $50 million fraudulently obtained from homelessness support. Cody Holmes, the former CFO of Shangri-La Industries, has been arrested this morning, and real estate developer Steven Taylor was indicted by a grand jury yesterday, with both men facing charges in separate investigations. Holmes is alleged to have siphoned public funds intended for homelessness, utilizing millions for personal gain, while Taylor is accused of deceiving banks to fraudulently secure loans, which included a property in Cheviot Hills that he flipped and sold to a homeless housing development company at more than double the initial purchase price.
California has spent billions of taxpayer dollars to combat its homelessness crisis with very little to show for it. Six months ago, I announced the Homelessness Fraud and Corruption Task Force. Today, we begin to hold people accountable by announcing two cases where more than… pic.twitter.com/jUFpLhBmsZ
— Acting U.S. Attorney Bill Essayli (@USAttyEssayli) October 16, 2025
Clearly, Essayli is treating this matter with utmost seriousness. It is high time that accountability was applied to those profiting while the homelessness crisis escalates. This situation not only casts a long shadow over the integrity of public funding but also underscores a systemic failure to combat a pressing societal issue—one that should not become a vehicle for personal enrichment.
