New homeless shelter planned in Cheviot Hills amid federal fraud investigation

LOS ANGELES - A new homeless shelter is set to open soon in Cheviot Hills, despite an ongoing federal investigation tied to the property that has already led to one arrest. Neighbors say they’re frustrated and demanding answers after learning about the project and the allegations surrounding it. The building, a former senior living facility, is being renovated to include more than 70 beds. The Weingart Center, a Los Angeles-based nonprofit that provides housing and services for unhoused residents, purchased the property in 2023.

However, federal agents recently arrested real estate executive Steven Taylor, who is accused of bank fraud, identity theft, and money laundering. Investigators allege Taylor used fake bank records and bogus lines of credit to purchase the property for $11 million — then sold it to the Weingart Center roughly 10 days later for $27 million, a $16 million profit.

"We believe it should be stopped, at least during the federal investigation," said Samantha Nusseaum, a concerned neighbor. "Where is that $16 million profit that was intended to be used for homeless housing? It seems to have been diverted."

Despite Taylor’s arrest, construction has continued inside the building as the Weingart Center prepares to open the facility. Some neighbors say they’ve received little communication about the project and worry it could change the character of their quiet neighborhood near Palms Elementary School.

"A lot of the things that we hold really dear in this neighborhood, that we worked so hard for — it looks very shaky right now," said Amanda Ryan, another concerned neighbor. "No one is responding to our messages. We’ve been calling for meetings. We just feel like we’re being ignored."

A spokesperson for Los Angeles City Councilmember Katy Yaroslavsky, who represents the area, said the councilmember’s office "had no role in the selection, negotiation , or financing of the Shelby property."

"We share the community’s outrage over these allegations and expect a full accounting of the facts," the statement said. "If the allegations against Mr. Taylor are proven, restitution should be paid to the city. As chair of the city’s Budget Committee, Councilmember Yaroslavsky expects transparency and accountability in every taxpayer-funded project."

The statement also acknowledged the ongoing need for housing for older unhoused adults, noting that the population has grown 36% in Los Angeles over the past two years despite an overall decline in homelessness.

"Councilmember Yaroslavsky remains focused on ensuring the Shelby site is operated responsibly and serves both its residents and the surrounding community," the spokesperson said.

A spokesperson for Los Angeles Mayor Karen Bass also defended the project’s importance, calling it "a critically important property that will provide interim housing in an area of the city that has extremely limited interim housing supply."

"To address the concerns of nearby residents, a compromise was made in 2023 to only provide supportive interim housing to seniors who are experiencing homelessness in Council District 5," the mayor’s office said. "The Homekey 3 grant applications prioritized sites in areas of the city where there is limited to no interim housing for unhoused people in order to continue confronting homelessness. The Homekey grant applications were approved by the City Council, and funding was granted by the State of California."

The spokesperson added that the city is cooperating with the ongoing federal investigation.

"The U.S. Attorney’s Office’s investigation of a private developer is ongoing , and the city is continuing to cooperate in the investigation," the statement said.

Mayor Bass also released a statement following the developer’s arrest:

"Today, we learned that a private developer had been arrested and charged in a complex scheme to defraud lenders across Los Angeles and Ventura counties. One of the alleged fraudulent schemes involved real estate in West L.A. that was acquired to provide housing for elderly Angelenos experiencing homelessness. My administration has zero tolerance for corruption — period. We’re working with the U.S. Attorney’s Office to ensure that anyone who engages in fraud against the city will face the full force of the law and my administration’s unwavering commitment to accountability."

A federal task force continues to investigate alleged fraud and misuse of homeless program funds across California. Construction at the Cheviot Hills site was expected to finish this month, though it remains unclear when the facility will begin operations.