St. Paul Reporter

Minnesota lawmakers are addressing concerns about fraud and waste in state government programs. Recent reports have highlighted large-scale fraudulent activity affecting several state-run initiatives, leading to significant financial losses.

Acting U.S. Attorney Joe Thompson recently spoke at a press conference about the extent of fraud in Minnesota's government programs. He stated that fraudulent organizations have overtaken legitimate ones within these systems. Thompson noted that his office has prosecuted more than half a billion dollars in fraud cases, but believes the actual losses are much higher. In an interview with MPR, he estimated total losses to be “in the billions of dollars,” suggesting the amount may have surpassed $2 billion during Governor Walz’s tenure.

Several high-profile cases were cited as examples of this pattern:

- The Feeding Our Future scandal involved $250 million stolen from federal child nutrition funds.

- The Child Care Assistance Program (CCAP) saw at least $100 million in fraudulent claims.

- Medicaid billing for EIDBI benefits increased from $6 million to nearly $192 million, with much of it deemed fraudulent.

- Millions were lost to Medicaid addiction treatment fraud involving sham recovery programs.

- Housing Stabilization Services costs rose from an estimated $2.6 million to over $100 million annually due mostly to fraudulent payouts.

Some legislators argue that current oversight is insufficient and that reforms have been blocked by Governor Walz and House Democrats, leaving taxpayers vulnerable.

In response, House Republicans established the Fraud Prevention and State Agency Oversight Committee this year. According to committee members, their mission is "to hold government accountable" through hearings and investigations into agency operations. They advocate for creating an independent Office of Inspector General with subpoena power and law enforcement authority—a model used by other states.

A statement from a legislator emphasized: "Minnesotans work hard, pay their taxes, and deserve to trust that their dollars are used wisely. Yet time and again, we continue to see shocking reports of fraud and waste inside Minnesota’s state government. These scandals not only drain taxpayer dollars, they betray the trust of the very people we are here to serve."

The legislator added: "As a legislator and as a school principal, accountability is something I take very seriously. We must ensure every dollar is used effectively, whether it’s in a classroom, a local program, or a state agency."

Addressing constituents directly, the statement continued: "Thank you to everyone who has reached out to share your frustrations and ideas. Your input matters, and it helps me push for the real reforms Minnesotans are asking for. Together, we can stop fraud, protect taxpayers, and ensure that state government actually serves the people of Minnesota."