A major report released Wednesday by the House Oversight Committee claims that Minnesota Governor Tim Walz and Attorney General Keith Ellison failed to act on widespread fraud in the state’s social services programs and even tried to cover it up. The report was made public the morning lawmakers began hearing testimony from Walz and Ellison about the issue.
The investigation was started by Republicans in the committee, led by Chairman James Comer, to look into how Minnesota handled several large fraud schemes uncovered last year. According to Comer and the report, evidence from documents and interviews suggests that Walz and Ellison knew about the fraud but misled the public about what they knew and how they responded. The report also claims they punished or intimidated state employees who tried to raise concerns.
Comer says that instead of protecting taxpayers and vulnerable residents, the state leaders “handed over billions in taxpayer dollars to fraudsters and threw their own state employees under the bus.” The report says Walz and Ellison were aware of credible reports of fraud in state programs as early as 2019, but meaningful action was delayed or never taken.
One issue examined in the report is the $250 million “Feeding Our Future” child nutrition program, a food aid initiative created during the pandemic. Federal prosecutors charged several people with fraud related to the program, saying they falsely claimed to serve meals and instead used funds for personal gain. The House Oversight Committee’s report argues that state education officials continued paying organizations involved even after serious problems were identified, and that there was no court order directing them to keep paying. Walz had previously suggested he was legally required to continue payments, but the report disputes that.
The committee also says state agencies had the legal power to suspend or stop payments to providers suspected of fraud, but hesitated because of fears of lawsuits or accusations of discrimination. Some whistleblowers told the committee they were warned not to talk about the fraud publicly because they might be called racist or Islamophobic.
Whistleblowers told investigators that when they reported suspected fraud, they faced retaliation instead of support. Some said their concerns were ignored, their careers were hurt, or they were discouraged from speaking up. According to the report, leaders within the Walz administration used private investigators and law firms in ways that seemed intended to silence staff raising alarms.
The Oversight Committee’s document also questions why state leaders didn’t respond more quickly when they first learned about suspicious activity. It argues that continuing to send federal money to providers allowed fraud to keep happening and wasted taxpayer dollars that were meant to help children, seniors, people with disabilities, and low-income families.
While the federal investigation and the congressional probe are separate, both have focused on allegations of fraud in Minnesota’s social services system. Some prosecutors have estimated the total amount of questionable payments in state Medicaid and other programs could be in the billions of dollars. Walz and Ellison have denied the claim that they acted improperly, saying their administration has worked hard to fight fraud and prosecute those responsible.
The report’s release has intensified scrutiny of Minnesota’s handling of public funds and will be a major topic as Walz and Ellison testify before Congress. The Oversight Committee says its work will continue as it seeks answers about how millions — or even billions — of taxpayer dollars were lost or put at risk.
