How ‘Minnesota Nice,’ Progressive Policies Paved Way for Somali Fraud

Minnesota state Sen. Eric Lucero in St. Michael, Minn., on Dec. 8, 2025. Lucero has called Minnesota “the epicenter of fraud and national embarrassment” after more than $9 billion in taxpayer funds was allegedly siphoned from its social welfare programs. Jenn Ackerman for The Epoch Times

“There’s a willingness to help everybody—without any consequences,” he said.

This attitude has made the state a beacon for progressives. It also manifests in generous welfare benefits. In 2023, those programs doled out $46,000 for each person in poverty in Minnesota. Of all the states in the nation, only Massachusetts distributed more welfare benefits, according to an analysis by the Center of the American Experiment, a Minneapolis-based public policy research group.

Many Minnesota counties also employ sanctuary policies, which involve blocking local law enforcement from cooperating with federal immigration authorities.

And lately, the North Star State has become a destination for “fraud tourism,” Thompson said, attracting out-of-staters who seek easy money.

A pair of Pennsylvania men, with no apparent Minnesota connections, “came here not to enjoy our lakes, our beautiful summers, our warm people,” the prosecutor said. “They came here because they knew and understood that Minnesota was a place where taxpayer money could be taken with little risk and few consequences.”

Those defendants are accused of cheating the state out of $3.5 million in fraudulent Medicaid payments, Thompson said. They are among 13 people charged thus far with scamming the state’s Housing Stabilization Services program.

The housing program tapped into Medicaid dollars with the intention of preventing homelessness, particularly among the elderly and disabled. The state shut down the program at the end of October, following an initial wave of charges levied against suspects in September.

Medicaid fraud is a problem in many states, and it typically involves companies overcharging for services. But Thompson said Minnesota’s Medicaid fraudsters are running “programs that are just entirely fraudulent” via shell companies.

“I think that’s unique to Minnesota,” he said.

Community members gather for a public hearing as the Minneapolis City Council considers strengthening the city’s separation ordinance barring cooperation with federal immigration agents in Minneapolis on Dec. 9, 2025. Jenn Ackerman for The Epoch Times

Program Flaws ‘Easy’ to Exploit

Additional charges are expected in relation to the housing stabilization program and to an autism services scandal.

Since both of those scandals broke in September, two people who ran autism therapy centers have been accused of “recruiting” children, getting them “qualified” for federal autism therapy reimbursements, and paying kickbacks to the children’s parents, a statement from the U.S. attorney’s office reads.

One of the defendants, Asha Farhan Hassan, 28, is awaiting sentencing after admitting guilt on Dec. 18, according to the U.S. attorney’s office. Prosecutors said she fraudulently reaped $14 million in autism services payments and also snared nearly $500,000 in the state’s largest fraud scandal: A $250 million meals-for-children racket known as Feeding Our Future.

Since 2022, 78 people—mostly Somalis—tied to that nonprofit organization have been charged; dozens have been convicted.

Feeding Our Future and its affiliates falsely claimed to serve millions of meals to needy children, prosecutors said. During the COVID-19 pandemic, the federal government relaxed requirements, opening the door for opportunists. Feeding Our Future is the nation’s largest COVID-19 pandemic-era fraud scheme, the Justice Department has said.

A former assistant U.S. attorney who worked on some of those cases, Joe Teirab, outlined fraud-fueling factors in that case.

“You have folks coming from a society with high levels of corruption,” he said. “You mix that with … a government handout system that has almost no checks and balances—and that’s just … a perfect storm for high levels of corruption.”

As Teirab gathered evidence against offenders, he was surprised to see “how easy it was” to take advantage of the system.

Sites claimed to feed ridiculously high numbers of children, he said, thousands in a single day. Their invoices “were just so obviously made-up,” he said.

In addition to the three major types of fraud that have led to charges, a fourth scandal is unfolding.

Aimee Bock, founder and executive director of the nonprofit Feeding Our Future, arrives at the Minneapolis federal courthouse with her attorney in Minneapolis on March 19, 2025. The nonprofit is at the center of Minnesota’s largest COVID-19-era fraud scandal involving federal child nutrition funds, in which it allegedly siphoned off nearly $500,000. Kerem Yücel/Minnesota Public Radio via AP

On Dec. 18, officers seized evidence in Medicaid’s Integrated Community Supports program. That money is supposed to assist people with “health, safety, and household tasks” so they can live independently in their homes, the Justice Department stated.

Investigators are probing one provider that “claimed to be providing 12 hours of services a day” to a man with severe mental illness. He “was found dead in his apartment,” despite the purported level of care, the U.S. attorney’s statement reads. No further details were released about the unnamed man’s death.

Funds Frozen, Scrutinized

So far, among the 87 Medicaid programs that Minnesota runs, authorities have identified 14 programs at risk for fraud. Officials are combing through claims in those programs worth $18 billion, dating back to 2018. “Half or more” could be fraudulent, Thompson said, which amounts to $9 billion.

Considering that Thompson’s figures exclude the remaining 73 Medicaid programs, his $9 billion estimate may be low, Minnesota House Republicans warned in a post on X.

Minnesota Gov. Tim Walz, a Democrat, said “it doesn’t really help” to speculate about the dollar amounts, according to a Dec. 19 report in MPR News.

The governor said he considers federal prosecutors to be “partners” who hold criminals accountable. Walz also said President Donald Trump’s administration may be encouraging inflated estimates for political reasons, the outlet reported.

Thompson, during his news conference, said he was disclosing the depth of the financial “iceberg” because the public deserves to know.

“We can’t solve the problem until we grapple with the size of it,” he said.

Walz said at an event on Dec. 19 that regardless of the amount of fraud, “This is on my watch.”

“I am accountable for this, and more importantly, I am the one that will fix it,” he said.

He appointed an anti-fraud “czar” in mid-December and in late October ordered an independent audit of the 14 fraud-prone Medicaid programs. The order froze payments for up to 90 days, aiming to stop fraud and restore public trust.

Minnesota Gov. Tim Walz (L) speaks to the media at Deerwood Elementary in Eagan, Minn., on Sept. 2, 2025. Walz said he considers federal prosecutors to be “partners” who hold criminals accountable. Stephen Maturen/Getty Images

Senior advocacy newsletter McKnight’s Senior Living expressed concern that people might suffer “unintended consequences” from the funding cutoff.

State Sen. Michael Holmstrom, a Republican, told The Epoch Times via text on Dec. 19, “The fallout from this fraud has already begun to impact our agencies.”

A vocational rehabilitation provider in his district told him that its “clients, the vulnerable adults these programs are meant to serve, are now paying the price” with processing errors and restricted services, he said.

“[People are worried that their] friends and neighbors across the state could struggle to get the care they need,” Holmstrom said.

Nathaniel Olson, an advocate for the state’s 600,000 people with disabilities, told state lawmakers during a Dec. 17 hearing: “My people are done suffering. We’re done with this fraud.” He also said he is “very scared” for his younger brother, who has a disability.

State Budget Woes, Tax Increases

Minnesota’s fraud-ridden programs all have one thing in common: sudden, explosive growth, according to figures Thompson cited.

The meals-for-kids program expanded by 382 percent from 2019 to 2020, reaching $70 million; in 2021, it spiked to $336 million. That was when the FBI began probing Feeding Our Future. In the intervening years, the Minnesota Department of Education, which administered the program, “did not investigate some complaints about Feeding Our Future, despite their frequency or seriousness,” a 2024 state oversight report reads.

The housing program, which started in 2021, was expected to cost $2.5 million per year, but costs have soared higher than $300 million total, Thompson said. He noted that the autism program has cost Minnesota more than $1 billion since its inception in 2018.

The “community supports” program, in which evidence was just seized, started with $4.6 million in 2021. Now it is “on pace for nearly $180 million despite the efforts to get a handle on the fraud in recent months,” Thompson said.

Minnesota state Sen. Michael Holmstrom in his office at the Senate building in St. Paul, Minn., on Dec. 8, 2025. Jenn Ackerman for The Epoch Times

Medicaid covers more than 80 million Americans for health-related support. It is jointly funded by federal and state governments.

In Minnesota’s case, fraud-related expenditures appear to be hitting the state budget, according to Bill Glahn, a policy fellow for Center of the American Experiment.

After boasting a record surplus of nearly $18 billion in 2022, the state is now facing a $3 billion deficit in its next two-year budget period, 2028 to 2029; state analysts expect spending to exceed revenues by $4.5 billion.

One line item, “forecasted programs,” is driving much of the increased spending; it refers to social welfare payments that are tied to many of the state’s fraud losses, Glahn wrote in a Dec. 17 column.

However, the word “fraud” is absent from the state’s 97-page budget for that period.

When a TV reporter asked how money lost to fraud might be represented in those numbers, budget commissioner Erin Campbell said, “It would show up in ‘increased spending’” in budget forecasts.

Based on that Dec. 4 exchange, “past fraud is now just baked into the spending numbers,” Glahn wrote, noting that fraud therefore is “incorporated into the spending baseline, treated as if it will continue forever.”

The costs of increased social programs are hitting taxpayers such as Doug, a Twin Cities-area father of three who requested anonymity.

Local governments have been enacting tax increases to help fund programs that the state requires, he said, noting that his property taxes just went up by 13 percent.

Because of increasing taxes, Doug said he and his wife have had to cut back on expenses for the past couple of years, including by buying fewer Christmas gifts for their children.

“We’re scraping, you know,” he said, adding that the family has considered moving to a state with a lower tax burden.

The Minnesota state Capitol is seen in St. Paul, Minn., on Dec. 8, 2025. After a record $18 billion budget surplus in 2022, the state now faces a projected $3 billion deficit for the 2028 to 2029 budget period. Jenn Ackerman for The Epoch Times

National Stage, Local Reactions

The fraud prosecutions, which began in 2022, gained widespread public attention and presidential action in recent weeks after City Journal, a publication of the Manhattan Institute, published an investigative report in November.

The article alleged that Somalis in Minnesota were sending money back to their homeland and that members of the al-Shabaab terrorist group were skimming millions of U.S. taxpayer dollars from those transfers.

Trump denounced Minnesota as “a hub of fraudulent money laundering activity.” He ended a temporary deportation shield for Somalis and multiple federal agencies launched investigations. A weeks-long Immigrations and Customs Enforcement operation led to more than 400 arrests of illegal immigrants from multiple countries.

Trump also raised questions about who knew about the fraud and enabled it both inside and outside the Somali community, according to state Rep. Walter Hudson, a Republican.

“[The president] spoke to the obvious truth that many of us here in the state have been dancing around for too long, because we’re afraid to say it,” Hudson told The Epoch Times.

Somalis, who come from a developing country and are unfamiliar with U.S. paperwork, surely must have had help setting up their fraud schemes, according to Hudson. That is why people want to see prosecutions of anyone who enabled the fraud, not just individual offenders.

‘Political Correctness’ and ’Political Theater’

Hudson serves on an anti-fraud committee that is digging for answers. Its chair, state Rep. Kristin Robbins, a Republican, said she has spoken to multiple whistleblowers “who said they were told not to say anything [about Somalis’ suspected fraud] because that would be ‘racist’ or ‘Islamophobic.’”

“There was, like, a cultural sort of political correctness [suggesting] that we’d better not talk about it,” she told The Epoch Times. “And that’s why it was allowed to balloon and mushroom out of control.”

Whistleblowers do not trust the state attorney general’s office or the investigative arm of the Minnesota Department of Human Services, she said during a Dec. 17 hearing. Thus, Robbins said, she informs federal authorities, including Thompson’s office and the FBI, instead of state agencies.

 Minneapolis City Council members convene a public hearing to consider revisions to the city’s separation ordinance barring cooperation with federal immigration authorities in Minneapolis on Dec. 9, 2025. Jenn Ackerman for The Epoch Times

State Reps. Dave Pinto and Emma Greenman, two of three Democrats on the eight-member committee, faulted Robbins for that. They accused her of playing partisan politics because the state agencies are under Democrats’ purview.

The information-sharing dispute evolved into a bigger controversy after the governor issued a statement.

“This is outrageous,” said Walz, whose reelection bid faces at least 10 Republican challengers, including Robbins. “I expect political attacks in an election year. What is unacceptable is actively withholding information about fraud and blocking investigations in order to advance a political agenda.

“If there is fraud, it needs to be investigated immediately—not sat on, redirected, or used for political theater.”

Robbins said Walz and other critics are mischaracterizing the situation. Her committee is not “covering up fraud” by protecting whistleblowers, she wrote in a Dec. 21 X post, adding, “This is a lie.”

As the investigations continue, Robbins said, constituents keep asking whether the stolen funds can be recouped. Prosecutors are trying to seize assets of the convicted fraudsters, but that process could take years while criminal appeals continue.

Fraudsters ‘Ruined Everything’

A trio of shoppers at the Karmel Mall of Somalia in Minneapolis, each of a different ethnicity, all condemned the fraud in interviews with The Epoch Times recently. They also discussed the impact of the scandal and government actions.

Shuaib Omar, a young Somali man, described a sense of fear and uncertainty gripping his community because of Immigration and Customs Enforcement and the labeling of Somalis as fraudsters.

A portrait of Shuaib Omar at Karmel Mall in Minneapolis on Dec. 9, 2025. Omar, a young Somali man, described a sense of fear and uncertainty gripping his community because of immigration enforcement and the labeling of Somalis as fraudsters. Jenn Ackerman for The Epoch Times

“But fraud is fraud, no matter who does it—Somali, white American, black,“ he said. ”Fraud is wrong, no matter who you are.

“[The fraudsters] have ruined everything for the rest of us.

“Now we’ve got this image of a whole community being bad people, which isn’t true.”

Omar said he loves the United States, his home since he was 8 years old.

A native of South Sudan, Awok Bol, 45, said she became a naturalized citizen and is “thankful to be here.”

It is wrong for newcomers to abuse Americans’ hospitality by defrauding government programs, Bol said.

“If somebody welcomes you in his home, you should be nice,” she said.

Mark Nelson, who is of African American heritage, said he cannot stand seeing people come into the United States and “siphon so much out of the state.”

Nelson said he is a property owner, and that he has noticed significant tax increases.

“I don’t think we’ve felt the full force of it yet,” he said.

When asked about reports on the fraud, Nelson said, “Our government should be more aware of what’s going on, and the needs of the people—and not let one group of people come in and demolish our funds.

“I really want to blame it on the government, for not keeping their eyes open.”

A portrait of Mark Nelson at Karmel Mall in Minneapolis on Dec. 9, 2025. Nelson said he cannot stand seeing people come into the United States and “siphon so much out of the state.” Jenn Ackerman for The Epoch Times

Possible Solutions on Horizon

Federally funded programs that states administer are breeding grounds for fraud and waste, according to the Cato Institute.

“Lax state administration” of federal funds worsened Minnesota’s fraud problems, Cato stated in a recent report. It urges the Trump administration to end federal-to-state aid programs.

“If state governments funded their own handout programs, they would have more incentive to run them lean and efficiently,” the institute stated.

In any case, Thompson said, “it’s going to take more than just prosecutors” to eradicate the fraud.

“We’re prosecuting what we can,” he said.

But according to him, the extent of the fraud is “far beyond the capability of a group of prosecutors and law enforcement agents,” even with around-the-clock dedication.

“[Ultimately, action will be needed from] regulators and other people looking into the problem and stopping the flow of money which has overwhelmed our system and overwhelmed our ability to prosecute,” Thompson said.