Federal prosecutors say Minnesota is at the center of the largest pandemic-era food-aid fraud scheme in the nation, a sprawling network that siphoned more than $1 billion intended to feed low-income children.
The investigation has so far resulted in charges against 86 individuals, including 78 of Somali ancestry, in what officials describe as a web of fake nonprofits, falsified meal counts, and elaborate kickback operations.
According to federal indictments, the scheme centered on nonprofits and affiliates that claimed to be feeding tens of thousands of children every day. In reality, investigators say the meals never existed. Prosecutors allege the same organizations also billed for providing services to nonexistent homeless Minnesotans and for therapy sessions for nonexistent autistic Somali children. Much of the stolen money was allegedly used to buy luxury cars, fund overseas transfers, and, in some cases, route cash to a foreign terror group.
Despite early whistleblower warnings, state enforcement agencies took no meaningful action, leaving the federal government to unravel the operation. Court filings and internal emails show that state officials expressed concern about political backlash if they aggressively scrutinized organizations tied to the Somali community.
The massive fraud unfolded under Gov. Tim Walz, who was accused of retaliating against state workers who raised red flags about the theft. Walz, the failed Democratic vice-presidential nominee on the Kamala Harris ticket against President Trump, has come under fire for what critics call a stunning failure of oversight.
The Trump Administration has announced steps to prevent similar abuses, including terminating Temporary Protected Status for Somalis, halting migration from third-world countries, reexamining green cards for aliens from countries of concern, and pausing asylum decisions.
Trump said the scandal “proves Minnesota has become a hub of fraudulent money laundering activity,” citing it as evidence of what he called Walz’s “dangerous incompetence.”