The billion-dollar Minnesota welfare-fraud scandal linked to the Somali community has ballooned to staggering proportions after an independent journalist, using video evidence, revealed an apparent daycare fraud far beyond what anyone had suspected.
Federal authorities now estimate the stolen funds to be on the order of $9 billion.
The revelations sparked an intense backlash, with Republican state senators as well as Trump administration officials accusing Minnesota Governor Tim Walz of incompetence and dereliction of duty, and demanding that he step down. [See Sidebar]
The 42-minute video posted by investigative reporter Nick Shirley shows Shirley and a local researcher travelling across Minnesota together to confront a sprawling network of fraudulent welfare operations, the majority allegedly run by Somali residents in the state.
In footage seen by over 100 million viewers, the two men question officials, inspect daycare facilities, and challenge occupants over lavishly funded programs licensed to serve hundreds of children that appear to be little more than hoaxes.
According to Shirley’s claims, some centers were paid millions of dollars each year despite showing no signs of operation.
Where Are The Children?
Researcher David who accompanied Shirley explains that his suspicions grew after years of passing the same locations and seeing no one there. ‘I would drive by these childcare centers in the middle of the day and there were never any kids there,’ he says. ‘That’s when I started asking, where are these children?’
Armed with research and data obtained by contacts at Minnesota’s capitol, the two men began investigating Minnesota’s childcare assistance system.
Visiting several childcare centers across Minnesota that are licensed for hundreds of children, the investigators found them empty of kids, with no visible activity at the sites.
According to government records, the day care sites have been raking in millions of dollars from welfare programs, yet the reporters found dozens of the facilities meant to host these programs vacant and locked, with blackened windows, or no windows at all.
Standing outside one Minneapolis building, Shirley says: “Between these two childcare centers alone, they are pulling in roughly $3 million a year, and there are no children.”
One address in St. Paul is shown housing more than a dozen registered healthcare companies. “Every door is another healthcare business,” Shirley says, adding that no one they approached would explain what services they provided or how much they charged.
In a few cases, the reporters were greeted by a person of Somali background in the otherwise empty building who either refused to answer questions, responded with hostility, or called the police, complaining of “harassment.”
Shirley and his sources claim authorities in the Democratic state had to be aware of a suspicious lack of activity at many of these sites—it was a scandal hiding in plain sight, they say. But authorities turned a blind eye and failed to intervene. Fear of antagonizing Minnesota’s Somali community, an 80,000 strong voting bloc, was likely the force that bought silence, critics say.
“If you’re a politician, it’s a significant disadvantage for you to alienate the Somali community,” former state senator David Gaither was quoted in City Journal as saying. “If you don’t win the Somali community, you can’t win Minneapolis. And if you don’t win Minneapolis, you can’t win the state. End of story.”
“These were sophisticated criminal enterprises that exploited Minnesota’s generous welfare state,” the paper noted. “When auditors wanted to investigate, “the fraudsters deployed baseless accusations of ‘racism’ against Somalis [who are black], to shield criminal behavior.
Pressure Mounts on Gov. Walz As Calls for Accountability Grow
The walls are caving in on Tim Walz,” House Oversight Committee Chairman James Comer, R-Ky., said on America’s Newsroom. “This massive amount of fraud is affecting and impacting every citizen of Minnesota. They’re having their services cut because so much of the money for social programs was wasted and defrauded by these criminals.”
Comer has announced plans to draft criminal referrals related to the fraud investigation. According to Comer, credible Minnesota whistleblowers will be invited to testify under oath before Congress, and subpoenas will be issued to financial institutions as part of the inquiry.
He stated that criminal prosecution may follow if evidence demonstrates retaliation against whistleblowers by Governor Walz or Attorney General Keith Ellison.
Comer emphasized that the committee intends to obtain sworn testimony and will also hear from state lawmakers and municipal leaders, including mayors, as the investigation advances. He described the situation as “escalating” and indicated that accountability measures are forthcoming.
In a sign of how the scandal has rallied local authorities, 98 Minnesota mayors wrote a scathing letter to Walz expressing grave concern with the widespread allegations of fraud and reckless spending at the state capitol. These excesses have reduced cities’ ability to operate efficiently, the letter said.
“As mayors, we see firsthand how these decisions ripple outward. Fraud, unchecked spending, and inconsistent fiscal management in St. Paul have trickled down to our cities. That has reduced our capacity to plan responsibly, maintain infrastructure, and sustain core services without overburdening local taxpayers,” the mayors write.
The letter also mentioned the unprecedented deficit in the state, saying Minnesotans “have watched an historic $18 billion surplus disappear in a single biennium (two year span), only to now face an updated projected $3 billion deficit in the 2028–29 biennium.”
“What we see in Minnesota is not a handful of bad actors committing crimes. It’s a staggering industrial scale fraud,” said Assistant U.S. Attorney Joe Thompson an interview with Forbes. “I don’t make these generalizations in a hasty way, so when I say a significant amount, I’m actually understating. When I look at the claim providers and data, I see more red flags than legitimate providers—and overwhelmingly so.”
FBI ‘Surged’ Investigators to Minnesota
Calling Minnesota “a hub of fraudulent money laundering activity,” President Trump has called for federal authorities to step up their investigation into the alleged web of money laundering and embezzlement of government funds within the state’s 80,000-strong Somali community.
He recently announced that he was stripping Somali immigrants from TPS — Temporary Protected Status—a legal safeguard for immigrants against immigration from certain countries. He also said he did not want immigrants from the “crime-riddled” East African country to stay in the United States.
FBI Director Kash Patel said Sunday the agency “had surged personnel and investigative resources to Minnesota” to “dismantle” the alleged fraud schemes even prior to the issue gaining attention on social media.
Patel mentioned the 78 indictments and 57 convictions already on record, for charges including wire fraud, money laundering, conspiracy, and jury tampering. Investigations continue. “The FBI believes this is just the tip of a very large iceberg,” Patel said.
The FBI director said in his statement that many of those involved with the alleged fraud schemes “are also being referred to immigration officials for possible further denaturalization and deportation proceedings.”
What the FBI director didn’t say, but was clear between the lines, was that the FBI has been investigating this massive fraud for years, even during Biden’s Administration. The American people now know, no thanks to the media but based on the fraud indictments and trials that have come to light, that the first raids occurred in January, 2022.
The media ignored it for as long as possible and is doing its best to minimize it even now.
Some of the alleged fraud schemes date back to 2015 when daycare centers were alleged to have overcharged Minnesota’s Child Care Assistance Program. More recent schemes have involved Medicaid-funded disability schemes, particularly a housing program that helped seniors and those with disabilities, which was shut down earlier this year due to “large-scale fraud.”
Gov. Walz has been struggling to do damage control, not even attempting to debunk Nick Shirley’s findings.
When Fox News asked Walz’s spokesman about Shirley’s video, the response was to insist that the governor “has worked for years to crack down on fraud and ask the state legislature for more authority to take aggressive action. He has strengthened oversight — including launching investigations into these specific facilities.”
The spokesman pointed to the fact that “one of the [fraudulent] facilities had been closed” as evidence of the governor’s “aggressive action.” (One facility, out of hundreds that were allowed to remain open.)
GOP congressmen aren’t buying it.
“Gov. Walz has said that the Oversight Committee doesn’t need to worry about this investigation, that he would take care of it himself. No one in America believes that,” Comer scoffed. “We are going to leave no stone unturned in investigating this.”
DOJ Promises More Prosecutions
U.S. Attorney General Pam Bondi in an online post underscored Patel’s “tip of the iceberg” comment while assuring the public that the Justice Department is not slacking on the job.
“Nick Shirley’s work has helped show Americans the scale of fraud in Tim Walz’s Minnesota. The Justice Department has been investigating this for months. So far, we have charged 98 individuals—85 of them of Somali descent. More than 60 have been found guilty in court,” she wrote. “BUCKLE UP—we have more prosecutions coming.”
Other prominent Trump officials have weighed in on the scandal, with Vice President JD Vance saying the issue “is a microcosm of the immigration fraud in our system.”
“[Crooked] politicians like it because they get power. Welfare cheats like it because they get rich,” Vance wrote. “But it’s a zero sum game, and they’re stealing both money and political power from Minnesotans.”
Critics have pointed out that Minnesota historically had no Somalis but with massive immigration from the East Africa state, the Somali voting bloc was eventually able to get Somali-born Ilhan Omar elected to Congress.
Labor Secretary Lori Chavez-DeRemer singled out Omar as one of the key Democrats who championed the loosening of eligibility restrictions and oversight for Minnesota’s welfare and Medicaid programs. The softening of regulations created loopholes that invited criminal exploitation, he said.
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GOP Lawmakers in Minnesota Call for Gov. Walz to Resign
“Minnesotans have been watching the fraud crisis get worse and worse for years. It has gone on long enough,” Minnesota state Senators Bill Lieske and Nathan Wesenberg, along with state Reps. Marj Fogelman, Drew Roach and Mike Wiener, said in a press release.“This is not about politics or stunts, and we do not make a call like this lightly. The office of the governor deserves respect, and we have tried to give Gov. Walz time to act.”The lawmakers explained that “leadership means doing the right thing even when it is difficult, which is why we are calling on Gov. Walz to resign.”“We are talking about billions of dollars in fraud that should have gone to vulnerable Minnesotans. The red flags were everywhere. Yet, year after year, the fraud kept growing, and year after year, nothing changed.”The lawmakers said in their statement that the fraud scandal is the “number one” issue they hear from their constituents, along with questions about why no one in power has been held accountable, a Fox News article summarized.“What we are seeing from the governor is what nonfeasance looks like,” the lawmakers wrote. “When a governor fails to do what he is required to do, when he watches a crisis spiral out of control and does nothing to stop it, that is nonfeasance. The governor had a duty to oversee his administration and protect these programs. He failed. There needs to be consequences.“For the good of the state, Gov. Walz should step aside,” the congressmen concluded. “Minnesota needs accountability, a reset, and new leadership that can get us back on the right track.”
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From Rags to Riches: The Strange Saga of Ilhan Omar
Rep. Ilhan Omar, D-MN, went from nearly broke to being worth up to $30 million in just a year — “as a $9 billion fraud scheme involving the Somali community in her district unfolded right under her nose in Minnesota,” a NY Post article noted.
The paper went on to detail that it was Somalia-born Ilhan Omar who introduced the legislation that critics say paved the way for “the largest fraud of the pandemic.”“Omar introduced the MEALS Act in Congress in 2020, relaxing oversight of government sponsored children’s meals programs during the pandemic. This act facilitated what prosecutors call “brazen fraud on an unprecedented scale,” the NY Post wrote. “It allowed fraudsters to claim they served millions of meals without verification, while pocketing millions of dollars in government subsidies.”
Omar herself was seen in a resurfaced video distributing food for a “Feeding the Future” PR event in a Minnesota restaurant which is at the heart of the welfare-fraud scandal.Shortly after the scheme played out, Omar’s husband, Tim Mynett, launched Rose Lake Capital in 2022, a venture capital management firm, the article noted. The company which today boasts of “deep global networks built from on-the-ground work in more than 80 countries,” had less than $1,000 in assets in 2023, according to Omar’s financial disclosure.
The company saw its reported value go from nearly zero in 2023, to between $5 million and $25 million in just a year. Yet despite the reported windfall, the business’s only address is a WeWork in DC, according to its LinkedIn page.
Between September and October — when federal prosecutors announced charges to eight more individuals, including six of Somali descent, for their roles in the welfare scheme — the names and bios of Rose Lake Capitals’s nine officers and advisors were quietly removed from the website, the Post article notes.
“There’s a lot of strange things going on,” said Paul Kamenar, counsel to the National Legal and Policy Center. “Omar was basically broke when she came into office and now her assets have suddenly skyrocketed to anywhere between $6 million to $30 million, according to her latest financial disclosure. This was just months after the congresswoman dismissed claims she was a millionaire as “ridiculous” and “categorically false.”
Links To Perpetrators of the Fraud Scheme
The Minnesota congresswoman’s links to individuals charged in the Minnesota welfare scam have come under scrutiny in recent weeks.
One of those who pleaded guilty was Salim Ahmed Said, the co-owner of Safari Restaurant in Minneapolis, where Ilhan Omar held her 2018 congressional victory party. The restaurant owner was found guilty in August of stealing more than $12 million for serving 3.9 million “phantom” meals during the pandemic.
Prosecutors say he blew much of that stolen wealth on a $2 million Minneapolis mansion and a $9,000-a-month shopping habit at Nordstrom.
As the scam was under way in 2020, Omar appeared on video at Said’s Safari Restaurant to praise the Feeding the Future program. “Every day Safari provides 2,300 meals to children and their families,” she gushed in the video, while being filmed handing out trays of food.
Another fraudster, Guhaad Hashi Said, worked on Omar’s campaign in 2018 and 2020. He pleaded guilty in August to running a fake food site called Advance Youth Athletic Development, where he falsely claimed to serve 5,000 meals a day and pocketed $3.2 million out of the food program.Rep. Tom Emmer, R-MN, hinted at possible criminal charges without elaborating. “Ilhan Omar is as dishonest as they come,” he told The Post. “She promotes socialist policies while cashing in a taxpayer-funded paycheck and sitting on tens of millions of dollars. She needs to finally come clean about her assets.”
