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Who’s Minding the Minnesota Store?

The opinions expressed by columnists are their own and do not necessarily represent the views of
AP Photo/Tony Dejak

Apparently the vault at the Bank of Minnesota was left unguarded and wide open.

 Word got out among some of our newer citizens that Minnesota was handing out free cash. Few questions were asked and there would be soft penalties if anyonewas caught with their hands in the cash drawer. Theseresettled refugees figured that since they were an oppressed minority with a friendly administration and prosecutors (that they had helped elect) the money was theirs for the taking. And why not help themselves to hundreds of millions instead of just chump change. Both they and the Minnesota administrators understood that it was largely free federal money anyway. Mere rounding errors in Washington. 


 Any government that can forgive billions in student loans can certainly forgive a little fraud for a few hundred million for day care and children’s nutrition programs, right?

 The first installment of this story began when investigative reporters at Fox9 in Minneapolis weretipped off by some TSA inspectors about something strange they were seeing at MSP airport. Somalinatives were headed home with suitcases filled with cash. Millions in cash. They asked, where was it coming from and where was it going? The story got the attention of legislators who demanded an investigation. They soon learned that much of the money was coming from state and federal subsidies for Child Care Services. 

 Jay Swanson, an investigator in the Legislative Auditor’s Office reported that a group of Somali-owned child care facilities had been systematically over-billing the Child Care Assistance Program for several years. Swanson said that fraud in the program was “pervasive” and the total cost of the fraud was likely “in the $100 million range.” A later audit pegged it at $72 million. Stories circulated that much of the suitcase cash was actually on its way to warlords and terrorist groups in Somalia, but could not be substantiated. Of course, they couldn’t be disproven either. 

Taxpayers were defrauded of $70+ million. Millions may have gone to terrorists. Lots of people participated in the criminality. So, how many went to jail? About a dozen people were charged. At this writing, it appears that only one perpetrator plead guilty in federal court and was sentenced to one year in prison. The Hennepin County Attorney ultimately charged three of the child care centers. The centers themselves paid fines and agreed to restitutions ranging from $13,700 to $103,000. As part of the plea agreements, criminal fraud charges against the individuals (who actually committed the crimes) were dropped.


So taxpayers recovered $144,967 of the $72 million. One person went to jail. You may have heard that the law teaches. The lessons of the soft treatment in this case were not lost on others. 

 Fast forward to the next mega fraud scandal. 

 Last week the U.S. Attorney in Minnesota announced indictments of 48 individuals who were part of one of the largest fraud conspiracies in history. He alleges that these people bilked the Minnesota Department of Education out of a Quarter of a Billion dollars! They created dummy businesses that fed tens of thousands of imaginary children. They over-billed the child nutrition program a whopping $250 million. 
To make certain poor kids wouldn’t go hungry during the COVID school shutdowns Congress poured extra Billions into nutrition programs. The perps saw this as a cow to be milked. Through their fake feeding programs they billed the state for hundreds of thousands of meals for imaginary children that were never served. Long after the cow was out of the barn, state officials became suspicious and tried to shut thescheme down. 

But wait, these weren’t ordinary crooks. They were oppressed minorities. They filed a suit charging discrimination. Believe it or not, a state judge agreed and declared that the state could not shut them down. The money spigot was turned back on. Finally, state officials told the FBI about what they suspected. The FBI’s lengthy investigation (with the money still flowing) probably alerted some of those now charged that the jig was about up and they disappeared. Currently only 7 of the 48 suspects are in custody. At least three are believed to have already left the United States. One was apprehended after allegedly booking a one-way flight to Ethiopia.


So what are we to make of all this? An obvious conclusion is that by giving any group special treatment you may not be helping them. Second, governments that hand out billions in free stuff should not be surprised when people figure out how to exploit and defraud those programs. Too many regard government “funding” as freemoney, so why not take advantage of it? And why did it take so long to shut these fraudulent scams down? Sadly, the taxpayers will likely recover pennies on the dollar. 

Finally, consider this question. Obviously, many people in the community had to know what was going on. Yet theyadhered to a code of silence. So why are we supposed to believe that a subculture that would harbor this level of massive financial fraud could never be party to election fraud?

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