On Tuesday, the Trump administration announced a significant measure by freezing child care funds allocated to Minnesota due to rampant fraud schemes that have emerged over recent years. Deputy Secretary of Health and Human Services, Jim O’Neill, took to the social platform X to reveal that this decision is a direct response to “blatant fraud that appears to be rampant in Minnesota and across the country.” He stated, “We have turned off the money spigot and we are finding the fraud.”
This announcement follows closely on the heels of a fraud investigation conducted by U.S. Homeland Security officials in Minneapolis, where they visited various unidentified businesses to question employees. The investigations have been ongoing for years, stemming from a staggering $300 million scheme involving the nonprofit organization Feeding Our Future. This organization is alleged to have orchestrated the country’s largest COVID-19-related fraud scheme, exploiting a state-run, federally funded program aimed at providing food for children. So far, 57 defendants have been convicted in Minnesota related to this fraud.
Prosecutors have claimed that approximately half, or more, of the nearly $18 billion in federal funds allocated to 14 different programs in Minnesota since 2018 may have been misappropriated. Many of the accused individuals are identified as Somali Americans. In his social media post, O’Neill, who also serves as the acting director of the Centers for Disease Control and Prevention, announced that future payments through the Administration for Children and Families (ACF) will now necessitate “justification and a receipt or photo evidence” before any funds are disbursed.
To further tackle fraud, the government has initiated a fraud-reporting hotline and email address. O’Neill specifically called out a right-wing influencer who posted a video alleging that day care centers operated by Somali residents in Minneapolis were involved in fraud amounting to $100 million. He has demanded that Minnesota Governor Tim Walz conduct an audit of these centers, which should include attendance records, licenses, complaints, investigations, and inspections.
Governor Walz’s office has yet to respond to inquiries from The Associated Press regarding the allegations. According to Assistant Secretary Alex Adams, the Administration for Children and Families allocates approximately $185 million in child care funds each year to Minnesota, funds that are intended to support about 19,000 American children, including toddlers and infants. Adams emphasized, “Any dollar stolen by fraudsters is stolen from those children.”
In a recent conversation, Adams noted that the director of Minnesota’s child care services office could not confidently ascertain whether the fraud allegations were isolated incidents or indicative of a wider statewide issue. Governor Walz, who is also the 2024 Democratic vice presidential nominee, has vowed to take a hard stance against fraud, asserting that his administration “will continue to work with federal partners to ensure fraud is stopped and fraudsters are caught.” He anticipates that an audit due by late January will provide a clearer picture of the fraud's extent and has committed to taking aggressive action to prevent further fraud.
Amidst these developments, Democratic U.S. Representative Ilhan Omar, a prominent Somali American figure in Minnesota, has urged the public not to generalize blame towards an entire community based on the actions of a few individuals. This situation underscores the importance of accountability and the need for transparent systems to protect essential funding for vulnerable populations.