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Minnesota Child Care Payments Canceled Amid Massive Fraud Investigation

The federal Health and Human Services Department has pulled the plug on all child care payments to Minnesota after federal officials said they found rampant fraud tied to state-run, federally funded programs. Deputy HHS official Jim O’Neill announced the freeze and said the agency has “turned off the money spigot” until Minnesota produces records proving funds went where they were supposed to go.

Under the new restrictions, payments routed through the Administration for Children and Families will only be released with detailed justification — including receipts or photo evidence — and HHS has opened a fraud-reporting hotline to identify bad actors. This is a common-sense step: if taxpayers must write the checks, the government must verify the work was actually done.

This crackdown didn’t come from nowhere. Federal prosecutors have spent years tearing apart schemes like the Feeding Our Future fraud, a pandemic-era racket that prosecutors say funneled hundreds of millions away from children and into the pockets of criminals — a case that resulted in multiple guilty verdicts and lengthy prison sentences. That kind of brazen theft demands a federal response, not political hand-wringing.

Investigators say the problem is not isolated: prosecutors have alleged that as much as half of roughly $18 billion in federal funds supporting multiple Minnesota programs since 2018 may have been misappropriated, and many defendants charged so far are Somali Americans. No community should be smeared, but neither should entire programs be allowed to become cash cows for fraudsters.

Let’s be clear: Conservatives have long warned that unchecked federal spending and lax oversight invite corruption and waste. Turning off the taps while auditors comb through records isn’t cruelty — it’s accountability. Taxpayer dollars were intended to help American children, not to bankroll sham operations and luxury purchases for the few who gamed the system.

Governor Tim Walz and other state Democrats tried to spin the freeze as political theater, but talk won’t stop theft. Walz says the state is working to crack down, yet federal officials say they need audits, attendance records, licenses and complaints to prove Minnesota has done its job — records the administration must now deliver. Political excuses won’t replace receipts.

If real wrongdoing is found, prosecutors should move swiftly and the full force of the law should follow: indictments, convictions, forfeiture of ill-gotten gains and prison time for those responsible. The Department of Justice has already secured heavy sentences in Feeding Our Future prosecutions, demonstrating that when federal investigators and prosecutors act, justice can be done.

Americans who work and play by the rules deserve better than a broken system that rewards fraud. We should protect immigrant communities from blanket blame while at the same time demanding rigorous enforcement, transparency, and real reform. This is about defending our kids, our taxpayers, and the integrity of American programs — and if the evidence shows crimes, it’s time to arrest and prosecute, not apologize.

Written by Staff Reports

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Minnesota Taxpayer Money Under Siege: Investigative Journalist Exposes Fraud