Gavin Newsom’s California Explodes in Fraud as he Galavants in Germany

A few million here, a hundred billion there… California is awash in horrific fraud. Thursday, CAL DOGE announced another $370 million in fraud has been uncovered.

In response, Governor Gavin Newsom’s rapid response press team that the governor running for President has been “Fighting fraud, saving time, cutting costs: Governor Newsom’s efficiency strategies are improving state government.”

“Through Governor Newsom’s efficiency strategies, California continues to make the state work better for Californians by fighting fraud, building affordable housing faster, streamlining cumbersome state procurement methods, and modernizing workflows using cutting-edge technology.”

Pffffft. Yah right. Gov. Newsom is galavanting in Germany right now, “preening for the cameras,” instead of actually doing what his teenage PR team claims.

CAL DOGE, created by gubernatorial candidate Steve Hilton, announced it has untangled a web of funding from the Prop 64 authorized California Cannabis Tax Fund (CCTF) – supposed to be used for substance abuse prevention – that instead is building the Democrat political machine in California.

Last week, the White House announced plans for a new anti-fraud task force targeting welfare abuse in California and other states, and assigned Vice President J.D. Vance, Andrew Ferguson of the Federal Trade Commission (FTC), and Attorney General Pam Bondi.

Almost immediately California Attorney General Rob Bonta fell all over himself claiming that the California Department of Justice was working to tackle fraud in the state. He even “pushed back” against the Trump Administration’s characterization that California programs are overrun by fraud and that state government is somehow facilitating this fraud.

By Friday morning, the Small Business Administration upstaged AG Bonta and announced it has uncovered $8.6 billion in suspected fraud tied to COVID-era relief lending in California and has suspended more than 111,000 borrowers in the state.

SBA Administrator Kelly Loeffler said the borrowers are suspected of improper activity involving federal pandemic programs, including Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) funds.

“They are accused of collecting money under the paycheck protection and economic injury disaster loans from the federal government that were supposed to ease the economic burden from covid,” the NY Post reported.

“This staggering number represents the most significant crack-down on those who defrauded pandemic programs, and it illuminates the scale of corruption that the Biden Administration tolerated for years.”

“As we did in Minnesota, we are actively working with federal law enforcement to identify the criminals who defrauded American taxpayers, hold them to account, and recoup the stolen funds.”

More fraud…

Administrator Loeffler and EPA Administrator Lee Zeldin were also in meetings in the Pacific Palisades with Los Angeles Mayor Karen Bass and Los Angeles County Supervisor Kathryn Barger focused on speeding up the rebuilding process to help wildfire victims demanding long-overdue assistance.

Loftier said President Trump has surged billions in resources to support the Los Angeles wildfire recovery effort, including $3.2 billion across 12,000 SBA loans to help residents rebuild. “One year later, thousands of families and small business owners are now suffering from a second disaster, which is the local permitting process that has prevented them from accessing these funds to rebuild their homes and livelihoods,” said Administrator Kelly Loeffler. Loftier even had to set up a system so SBA borrowers can bypass the massive permitting delays in LA.

And where is that $100 Million in FireAid funds raised?

More fraud…

Early in February, California’s U.S. Attorney Bill Essayli announced the arrest of Alexander Soofer of Los Angeles, who was charged with wire fraud, and that officials seized his $125,000 Range Rover and LA mansion, after he was arrested for allegedly stealing millions in taxpayer funds meant to house and feed the homeless in Los Angeles. Soofer was contracted with the city and county of Los Angeles, to house and feed up to 600 homeless people. But instead, spent millions on a luxurious life, the Globe reported. Soofer stole approximately $23 million.

Shortly after this revelation, Dr. Mehmet Oz, Administrator of the Centers for Medicare and Medicaid Services (CMS), said California is one of the epicenters for fraud, waste and abuse in the entire country, and they are probing massive suspected hospice and home‑health fraud in Los Angeles. Oz said $3.5 Billion in fraud just in Los Angeles County.

In response, the White House announced a new anti-fraud task force targeting welfare abuse in California and other states, and assigned Vice President J.D. Vance, Andrew Ferguson of the Federal Trade Commission (FTC), and Attorney General Pam Bondi.

“California has been a focal point in recent fraud investigations. State auditors previously identified billions of dollars in fraudulent unemployment insurance claims and improper pandemic relief payments. Governor Gavin Newsom (D) has defended his state, claiming his administration has made efforts to recover funds and strengthen oversight,” the National Pulse reported.

In January the Globe reported:

Venture capitalist and outspoken California critic Chamath Palihapitiya ignited a firestorm on social media Monday, highlighting the staggering scale of California’s non-governmental organization (NGO) sector and its potential for massive fraud. 

Quoting a viral post detailing over 213,000 NGOs in the Golden State generating a whopping $593.4 billion annually—dwarfing even New York’s $445.8 billion—Palihapitiya warned that up to 20 percent could be plagued by compliance issues, equating to $120 billion in potential waste, fraud, and abuse. That’s a quarter of California’s entire FY25-26 budget, funneled through shadowy “progressive” non-profits with minimal to zero oversight.

Here are key reports linking directly to the issues raised by Palihapitiya:

• Greenberg: San Francisco’s Latest Failed Social Programs – Details how the Providence Foundation settled for $1 million over wage theft and fraudulent invoicing in homeless services. 
• Homelessness Fraud and Corruption Task Force Nabs Two Alleged Fraudsters – Covers charges against Steven Taylor for bank fraud and money laundering in homelessness aid scams. 
• $100 Million in FireAid Relief Funds Went to Non-Profits Instead of Fire Victims – Reveals how disaster relief donations were diverted to NGOs, sparking scam accusations. 
• Gubernatorial and Controller Candidates Request Federal Investigation into California’s Widespread Fraud, Waste, and Mismanagement – Highlights calls for DOJ probes into systemic corruption, including NGO involvement. 
• California’s Homeless Industrial Complex: $20 Billion Spent, Problem Worsens – Exposes how NGOs profit from endless funding cycles without results.
• Audit Reveals Mismanagement in California’s Non-Profit Grant Programs – Uncovers compliance failures mirroring the IRS stats cited by Palihapitiya.
• Feds Probe Bay Area NGOs for COVID Relief Fraud – Details ongoing investigations into pandemic fund abuses.
• How Catholic Charities San Diego Transformed Into an $80M Refugee Powerhouse on a Tide of Federal Dollars — highlights refugee resettlement, with a spotlight on President Joe Biden’s disastrous withdrawal from Afghanistan which spurred an Afghan “refugee” crisis, causing the California government to create new state programs to assist Afghani “newcomers” under Biden’s Operation Allies Welcome program

In March, Globe contributor Richie Greenberg and I addressed “The Left’s Nonprofit Shadow Campaign Fund,” and explained, “When corporations cozy up to politicians through ‘charity,’ they’re not competing on merit—they’re buying influence.”

We have been ringing the alarm bells for many years about dubious non-profits tied to politicians and their families, friends, and associates… non-profits that are untraceable black holes for taxpayer/government funding. And it’s been going on a long time. Back when Jerry Brown was California Attorney General, I was reporting on non-profit fraud, and sending the information to the Attorney general’s office. But all I got back was crickets.

Back to CAL DOGE and their discovery:

An investigation into Elevate Youth California, which is one of the financial intermediaries that received $370M from the CCTF, found that Elevate Youth distributed 517 micro-grants, with an average grant size of $700K, to multiple organization that do nothing related to substance abuse and instead buildthe Democrat voter base. These organizations explicitly fund “social justice youth development, “civic engagement,” and “power building.”

According to Prop 64 and the supposed oversight group for Elevate Youth, The Center at Sierra Health Foundation, the tax is designated to support “funding and technical assistance for organizations that are developing or increasing community substance use disorder prevention, outreach and education focused on youth.” Instead, Elevate Youth is distributing funds to organizations – such as $1M for “civic engagement” to Young Invincibles, which has stated values of “Young Adult Power, Equity, Community, Collaboration, and Bold Ideas” but says and does nothing related to substance abuse prevention.

Here is Steve Hilton and CAL DOGE director Jenny Rae LaRou discussing this outrageous fraud:

🚨Gavin Newsom and the corrupt Democrat machine STOLE $370 million Cannabis Tax money from 'substance abuse prevention' to fund left wing activism and voter registration.

Brilliant work from my CAL DOGE colleagues @JennyRaeCA @Jeremy_ This is what a strong TEAM looks like: pic.twitter.com/pd3SHI1TKx

— Steve Hilton (@SteveHiltonx) February 13, 2026