Federal authorities have launched a new fraud investigation in Minneapolis, expanding a years-long effort to uncover widespread abuse of government-funded programs in Minnesota, according to the U.S. Department of Homeland Security.
Homeland Security Secretary Kristi Noem confirmed Monday that federal officers were actively conducting investigations in the city. The announcement follows the unraveling of what prosecutors have described as the largest COVID-19-related fraud scheme in U.S. history, centered on the now-defunct nonprofit Feeding Our Future.
Investigation Builds on Major Fraud Cases
The Feeding Our Future case involved a $300 million scheme that exploited a federally funded, state-administered child nutrition program. In total, 57 defendants in Minnesota have already been convicted for their roles in the case.
Earlier this month, a federal prosecutor alleged that a substantial portion of approximately $18 billion in federal funding distributed through 14 Minnesota programs since 2018 may have been fraudulently obtained. Those remarks intensified scrutiny of oversight failures and prompted renewed enforcement efforts.
Minnesota Governor Tim Walz has stated that his administration has zero tolerance for fraud and continues to cooperate with federal authorities to identify and prosecute those responsible.
Federal Agencies Increase Presence
Secretary Noem posted a video on social media showing Department of Homeland Security officers entering a business and questioning an employee. She said the operation was part of a large-scale investigation into suspected fraud involving childcare and other public assistance programs.
U.S. Immigration and Customs Enforcement also commented publicly, stating that taxpayers deserve accountability and arrests where misuse of funds is uncovered.
The latest action comes shortly after FBI Director Kash Patel announced that the bureau had increased staffing and investigative resources in Minnesota to dismantle what he described as extensive fraud networks exploiting federal programs. Patel said prior arrests represented only an early phase of a much broader investigation.
Political and Community Tensions
The investigations have unfolded amid heightened political tension. President Donald Trump has repeatedly criticized Governor Walz’s administration over what he describes as failures to prevent large-scale fraud.
At the same time, federal enforcement actions have coincided with increased scrutiny of the Somali American community in the Minneapolis–St. Paul area, which is the largest such community in the United States. According to the U.S. Attorney’s Office for Minnesota, a majority of defendants charged in recent fraud cases—particularly those involving child nutrition, housing assistance, and autism-related services—are Somali Americans.
State officials have emphasized that investigations are based on evidence and not ethnicity. Walz’s office says the governor has supported criminal prosecutions, strengthened oversight of high-risk programs, and hired outside auditors to review payment systems. His administration has also sought additional authority from the state legislature to act more aggressively against fraud.
Ongoing Oversight Efforts
Officials say the investigations remain active and could result in additional charges as authorities continue to examine how public funds were distributed and monitored. Federal agencies have signaled that uncovering fraud and restoring confidence in public programs remains a top priority.
