Federal agencies have dispatched investigators to Minneapolis to examine alleged fraud schemes involving daycare centers reportedly run by members of the Somali community. This action follows a viral video by independent journalist Nick Shirley, which accused these centers of receiving government funding while failing to care for children.
FBI Director Kash Patel announced that agents were already in Minnesota prior to the video’s release, working to dismantle what he described as large-scale fraud operations. During the pandemic, the FBI uncovered a scheme that defrauded the government of $250 million in federal food aid intended for vulnerable children. This investigation resulted in 78 indictments and 57 convictions. “The FBI believes this is just the tip of a very large iceberg,” Patel stated on X. “We will continue to follow the money and protect children, and this investigation very much remains ongoing.”
Homeland Security agents are also involved, focusing on suspected fraud sites throughout Minnesota. Federal prosecutors recently revealed that the state has identified 14 high-risk Medicaid programs, which have incurred costs of approximately $18 billion since 2018. They have suspended payments for these programs and initiated a third-party audit. First Assistant U.S. Attorney Joe Thompson emphasized the scale of the issue, stating, “The fraud is not small. It isn’t isolated. The magnitude cannot be overstated.”
Among the latest defendants, Abdinajib Hassan Yussuf, 27, allegedly received $6 million in Medicaid funds through fraudulent claims related to autism therapy for children. Yussuf reportedly paid kickbacks to parents in the Somali community to have their children diagnosed with autism spectrum disorder and enroll in his program. In a separate case, two individuals from Philadelphia are accused of coming to Minnesota to claim $3.5 million in fraudulent Medicaid payments, lured by the perception of “easy money.”
In response to Shirley’s allegations, KARE TV reported that the Minnesota Department of Children, Youth, and Families has dispatched inspectors to verify the conditions at the daycare facilities featured in the video. Commissioner Tikki Brown indicated that several of these centers are already under investigation, although previous inquiries have not substantiated claims of fraud. Recent inspections found children present at all centers visited within the past six months.
While some experts remain cautious about the claims made in Shirley’s video, they acknowledge the significant issue of fraud in Minnesota. Chris Edwards, a federal budget expert at the Cato Institute, noted that the financial scale of the alleged fraud is alarming for a state of Minnesota’s size. He highlighted weaknesses in the state’s oversight, suggesting that the automated nature of claims processing and the vast size of federal programs create fertile ground for fraud.
“There are too many government programs, and the fact that the feds are providing so much of the funding is just a recipe for this sort of trouble,” Edwards explained. He also proposed that states should take on greater responsibility for funding welfare programs. This approach would encourage local policymakers to scrutinize spending more closely, as they would need to balance their budgets.
Edwards urged federal authorities to apply insights gained from the Minnesota investigation to other states, searching for similar patterns of fraud. The ongoing investigations underscore a pressing need for vigilance in oversight of public funds, particularly in programs designed to support children and vulnerable populations.
As the investigations continue, the impact on the community and the broader implications for federal aid programs remain central concerns.
