HHS begins examination of Minnesota’s use of federal funds under Walz

Investigation into Minnesota’s Use of Federal Funds

The Department of Health and Human Services (HHS) has initiated an investigation into the allocation of billions in federal social services funding by Minnesota. This follows reports that raise concerns about potential misuse of these funds. A letter was sent from HHS to Governor Tim Walz, Minneapolis Mayor Jacob Frey, and nonprofit organizations involved in the Head Start program.

Alex Adams, the assistant secretary of the Department of Children and Families, mentioned that the investigation aims to assess whether federal safety net funds were misused or mismanaged, and if such actions might have facilitated illegal mass migration into the state. He emphasized the focus on accountability to American taxpayers and the importance of maintaining the integrity of federal benefit programs.

Strike Team Investigation Announced

The report also noted that Minnesota has received over $8.6 billion in funding through more than 1,000 federal grants from 2019 to 2025. Under the current administration, over $690 million was allocated for safety net programs in the 2025 fiscal year alone.

In the inquiry, Adams requested a comprehensive list of all entities within the state that received these federal funds, including detailed administrative data. This includes sensitive personal information like names, addresses, and social security numbers.

Adams expressed confidence that there are valid reasons to suspect that taxpayer money may have been misused, referencing ongoing fraud investigations pertinent to the Minnesota Department of Human Services. The letter also mentions whistleblower allegations that their concerns about fraud were overlooked, with subsequent retaliation reported.

Increased Scrutiny Amid Fraud Cases

This investigation occurs against a backdrop of increased scrutiny regarding how Minnesota manages federal funds, especially following notable fraud cases. Federal prosecutors have charged several individuals linked to a program intended for child nutrition, where over $250 million set aside for these initiatives was diverted for luxury goods and real estate purchases. Many of those implicated had connections to nonprofits serving the Somali community.

Additionally, there is data indicating that Minnesota’s illegal immigrant population increased by roughly 40,000 from 2019 to 2023, now estimated at about 130,000—making up around 2% of the state’s total population.

The ongoing ACF review encompasses critical federal programs like the Community Services Block Grant and the Low-Income Home Energy Assistance Program, among others.

In his letter, Adams reiterated the commitment to rooting out fraud and ensuring program integrity across federal benefit systems. He stated that the requested information is crucial for a thorough examination of program operations and to evaluate any possible fraud that may have transpired.