The US Department of Homeland Security has stepped in to assist the investigation of a massive fraud operation in the US state of Minneapolis, under the watch of department’s Secretary Kristi Noem.
The action comes after years of investigation into a fraudulent $US300 million ($448 million) scheme at the non-profit Feeding Our Future, for which 57 defendants in Minnesota have been convicted.
Prosecutors said the organisation was at the centre of the country’s largest COVID-19-related fraudscam, when defendants exploited a state-run, federally funded program intended to provide food for children.
This photo supplied by the US Attorney’s Office for Minnesota shows cash from a bag that was left at the home of a juror in a massive fraud case last year. It is part of a long-running investigation into a fraud racket in Minnesota surrounding COVID payments. (AP)
A federal prosecutor alleged earlier in December that half or more of the roughly $US18 billion in federal funds that supported 14 programs in Minnesota since 2018 may have been stolen.
Minnesota Governor Tim Walz said fraud would not be tolerated and that his administration “will continue to work with federal partners to ensure fraud is stopped and fraudsters are caught”.
Noem, one of US President Trump’s most trusted cabinet members, posted a video on the social platform X showing DHS officers going into an unidentified business and questioning the person working behind the counter.
Homeland Security Secretary Kristi Noem appears before the House Committee on Homeland Security. (AP)
Noem said that officers were “conducting a massive investigation on childcare and other rampant fraud”.
“The American people deserve answers on how their taxpayer money is being used and ARRESTS when abuse is found,” US Immigration and Customs Enforcement posted.
The action comes a day after FBI Director Kash Patel said on X that the agency had “surged personnel and investigative resources to Minnesota to dismantle large-scale fraud schemes exploiting federal programs”.
Patel said that previous fraud arrests in Minnesota were “just the tip of a very large iceberg”.
US President Donald Trump has criticised Walz’s administration over the fraud cases to date.
Trump has criticised Walz’s administration over the fraud cases. (Joe Raedle/Getty Images via CNN Newsource)
In recent weeks, tensions have been high between state and federal enforcement in the area as the Trump administration’s immigration crack down focused on the Somali community in the Minneapolis-St Paul area, which is the largest in the country.
Among those running schemes to get funds for child nutrition, housing services and autism programs, 82 of the 92 defendants are Somali Americans, according to the US Attorney’s Office for Minnesota.
Walz spokesperson Claire Lancaster said that the governor has worked for years to “crack down on fraud” and was seeking more authority from the legislature to take aggressive action.
Walz has supported criminal prosecutions and taken a number of other steps, including strengthening oversight and hiring an outside firm to audit payments to high-risk programs, Lancaster said.
