Over 3 years, homeless nonprofit paid more than $1.7 million to companies owned by its chief executive
A California homeless nonprofit funneled $1.7 million to its own CEO’s companies while claiming to house the unhoused.
A Step to Freedom, a California nonprofit dedicated to homeless housing, directed more than $1.7 million over three years to two companies owned by its chief executive.
The payments, uncovered in a Times review of public filings and internal records, flowed while the organization positioned itself as a key player in addressing California’s homelessness crisis. The arrangement raises the obvious question: how much of the money meant for the streets actually reached the intended recipients?
California taxpayers and private donors have poured billions into similar nonprofits with the expectation that funds would build housing, provide services, and reduce encampments. Yet here is a documented case in which more than $1.7 million cycled back to entities controlled by the very person running the charity.
The structure echoes a pattern seen across the state’s sprawling homelessness bureaucracy: lofty mission statements paired with opaque financial dealings. Public records reviewed by the Times show the extent of the self-dealing but stop short of explaining how the CEO’s companies delivered value that justified the payouts.
Advocates for the unhoused often argue that more funding is the only solution. This disclosure undercuts that claim. When executive-owned vendors capture such a large share of a nonprofit’s spending, the public cannot be certain the money is reaching shelters, case managers, or permanent housing units.
The real test will be whether regulators, donors, or the California Attorney General treat this as an isolated bookkeeping matter or as evidence that the state’s nonprofit homelessness industry needs far tighter oversight. Without it, the next million dollars will simply disappear down the same untraceable path.
Original reporting: LA Times.
Original reporting: LA Times, California.
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