Federal Child Care Payments Frozen in Minnesota
The U.S. Department of Health and Human Services (HHS) has decided to halt all federal child care payments to Minnesota. This action comes amid ongoing investigations into significant fraud, with allegations suggesting that millions of taxpayer dollars have been misappropriated to support non-existent or deceptive child care facilities.
On Tuesday, Deputy Secretary Jim O’Neill announced that all child care payments to North Star States are now frozen and indicated that the department has implemented “three actions” regarding the matter.
O’Neill noted, “You’ve likely heard about the serious claims that Minnesota has funneled millions in taxpayer funds to fraudulent child care centers over the last decade.” He added that three measures were taken to address what he described as pervasive fraud both in Minnesota and nationwide.
Outlined were the specific steps taken to curb fund misuse:
- Activation of the Expenditure Defense System for all ACF payments. Starting now, these payments will require a valid justification along with a receipt or visual proof before being processed.
- Identification of key individuals involved. O’Neill stated he had requested from Governor Tim Walz a thorough audit of these child care centers, examining their attendance records, licenses, complaints, investigations, and inspections.
- Establishment of a dedicated hotline and email for fraud reports. Members of the community—including parents and health care providers—are encouraged to share information.
This crackdown comes after independent journalist Nick Shirley reported on several Somali-operated facilities that received substantial public funds yet were seemingly unoccupied or entirely closed. Following these findings, Department of Homeland Security Secretary Kristi Noem dispatched federal agents to Minneapolis to probe the alleged child care scam.
Noem’s announcement marked a significant escalation in the claims surrounding the misuse of Minnesota taxpayer dollars, which were reportedly allocated to immigrant-run businesses existing mostly on paper.
