Trump administration says it’s freezing childcare funds to Minnesota after series of fraud schemes
The announcement comes one day after U.S. Homeland Security officials were in Minneapolis conducting a fraud investigation by going to unidentified businesses and questioning workers.
President Donald Trump’s administration announced on Tuesday that it is freezing childcare funds to Minnesota after a series of fraud schemes in recent years.
Deputy Secretary of Health and Human Services Jim O’Neill said on the social platform X that the step was in response to “blatant fraud that appears to be rampant in Minnesota and across the country.”
Minnesota Gov. Tim Walz pushed back in a post on X, saying that fraudsters are a serious issue that the state has spent years cracking down on but that this move is part of “Trump’s long game.”
“He’s politicizing the issue to defund programs that help Minnesotans,” Walz said.
O’Neil called out a right-wing influencer who had posted a video Friday claiming he found that daycare centers operated by Somali residents in Minneapolis had committed up to $100 million in fraud. O’Neill said he has demanded that Walz submit an audit of these centers that includes attendance records, licenses, complaints, investigations, and inspections.
“We have turned off the money spigot and we are finding the fraud,” O’Neill said.
The announcement came one day after U.S. Department of Homeland Security officials were in Minneapolis conducting a fraud investigation by going to unidentified businesses and questioning workers.
There have been years of fraud investigations that began with the $300 million scheme at the nonprofit Feeding Our Future, for which 57 defendants in Minnesota have been convicted. Prosecutors said the organization was at the center of the country’s largest COVID-19-related fraud scam, when defendants exploited a state-run, federally funded program intended to provide food for children.
A federal prosecutor alleged earlier in December that half or more of the roughly $18 billion in federal funds that supported 14 programs in Minnesota since 2018 might have been stolen. Most of the defendants are Somali Americans, they said.
O’Neill, who is serving as acting director of the Centers for Disease Control and Prevention, also said in the social media post Tuesday that payments across the U.S. through the Administration for Children and Families, an agency within the U.S. Health and Human Services Department, will now require “justification and a receipt or photo evidence” before money is sent. Officials have also launched a fraud-reporting hotline and email address, he said.
Walz, the 2024 Democratic vice presidential nominee, has said fraud will not be tolerated and his administration “will continue to work with federal partners to ensure fraud is stopped and fraudsters are caught.”
Walz has said an audit due by late January should give a better picture of the extent of the fraud. He said his administration is taking aggressive action to prevent additional fraud. He has long defended how his administration responded.
Minnesota’s most prominent Somali American, Democratic U.S. Rep. Ilhan Omar, has urged people not to blame an entire community for the actions of a relative few.