The Trump administration has ramped up scrutiny of Minnesota’s social services programs amid allegations of fraud.
Independent journalist Nick Shirley released a video detailing his investigation into the issue on Friday, sparking a renewed interest into the allegations. The Department of Justice (DOJ) has charged 98 people in connection with its sweeping probe into the matter, Attorney General Pam Bondi said Monday on the social platform X.
Here is what to know, by agency, regarding federal investigations into allegations of fraud in Minnesota:
Department of Justice
Dating back to 2022, the DOJ has charged dozens of people as part of its inquiry into alleged fraud within programs under the Minnesota Department of Human Services (MDHS). Those charged are accused of defrauding MDHS programs that receive federal funding, including from Medicaid.
Joseph Thompson, the assistant U.S. attorney for Minnesota, said at a press conference earlier this month that it is possible that “half or more” of the $18 billion billed to 14 MDHS programs since 2018 is fraudulent.
“The fraud is not small, it isn’t isolated,” Thompson added. “The magnitude cannot be overstated. What we see in Minnesota is not a handful of bad actors committing crimes, it’s a staggering, industrial-scale fraud.”
Bondi also said Monday on X that the DOJ is “working hand-in-hand” with the departments of Treasury, Homeland Security), Housing and Urban Development and Labor to “continue unraveling this scheme.”
Department of Homeland Security
The Department of Homeland Security (DHS) dispatched agents from its investigations unit to Minneapolis on Monday, with DHS Secretary Kristi Noem saying on X that her department is “conducting a massive investigation on [child care] and other rampant fraud.”
The department has shared multiple videos of investigators conducting inspections at businesses in Minneapolis over the last two days.
In one video, investigative officers approach a man in a store, whose face is blurred, and confirm that he received a notice of inspection for his business.
“We will root out this rampant fraud plaguing Minnesota,” DHS added.
Small Business Administration
Small Business Administration (SBA) head Kelly Loeffler said Monday that her department is halting annual grants to Minnesota, amid an inquiry into alleged fraud in COVID-era lending programs.
Loeffler said on X that the SBA is pausing the funding while it investigates $430 million in suspected Paycheck Protection Program (PPP) fraud in the state.
The PPP was established by the 2020 Coronavirus Aid, Relief and Economic Security Act, passed by Congress and signed into law by President Trump during the COVID-19 pandemic. The program provided more than $750 billion in forgivable loans to businesses to assist with payroll, operating and other essential costs.
Last week, Loeffler sent a letter to Minnesota Gov. Tim Walz (D) outlining at least $2.5 million in PPP and Economic Injury Disaster Loan funds sent to people indicted in the fraud probe.
Department of Health and Human Services
The U.S. Department of Health and Human Services (HHS) paused payments from its Administration for Children and Families to Minnesota on Tuesday.
HHS Deputy Secretary Jim O’Neill said on X that he has also demanded an audit of day care centers highlighted in Shirley’s video from Walz, including attendance records, licenses, complaints, investigations and inspections.
In fiscal 2024, the Administration for Children and Families provided more than $172 million to Minnesota’s Child Care and Development Fund, more than $31 million of which was used to “improve the quality and availability of child care,” according to the state’s Department of Children, Youth and Families.
“We have turned off the money spigot and we are finding the fraud,” O’Neill added.
Copyright 2025 Nexstar Media Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
