Latest news with #FeedingOurFuture
CBS News
3 days ago
- Politics
- CBS News
Minnesota pauses payments to 50 housing stability providers amid fraud investigation
Minnesota Gov. Tim Walz said Monday he paused payments to dozens of the state's housing stabilization providers as federal agents investigate a "massive" fraud scheme connected to the program. Under a new Minnesota law that went into effect earlier this month, state agencies have the authority to withhold funding from organizations for up to 60 days if there is significant evidence to suggest they have committed fraud. A search warrant filed with the U.S. District Court for Minnesota details a fraud investigation tied to the Housing Stabilization Services, a newer Minnesota Medical Assistance benefit, which is set up to help find and maintain homes for people with disabilities and the elderly. What was estimated in 2020 to cost taxpayers $2.5 million a year had topped $100 million. The FBI called the housing program "extremely vulnerable to fraud." Walz told reporters Monday he used the "tools" approved by the Minnesota Legislature to stop payments to "most of the people involved in this program." He later said that 50 of the state's largest housing stability providers "will not be paid." He expects some of them will sue to receive their payments. Others, he said, will have to be patient for their funds to come through. "There is going to be legitimate organizations and legitimate need for people in good programs that are gonna just have to be a little bit slower and a little more barriers in place. Because it's proven right now the folks can find the loopholes," he said. The Minnesota Department of Human Services confirmed they stopped payments to 43 providers on Monday. Payments to seven others had been paused prior to that week as a result of a "billing data analysis" and "investigations conducted by the DHS's Office of Inspector General." "In March, DHS initiated a comprehensive data analytics project, reviewing HSS provider data, including billing records, in new ways. As a result, we have stopped payments and provided information to our law enforcement partners," said temporary DHS Commissioner Shireen Gandhi in a statement to WCCO. "Any HSS providers scheming to steal from our public programs are being stopped from receiving further public payment and with the help of law enforcement partners, they will be prosecuted to the fullest extent of the law." Starting in August, housing stabilization providers will be subject to additional documentation requirements, the DHS said in a statement. The new Minnesota law to allow agencies to withhold funds was passed in the wake of the $250 million Feeding Our Future scandal, which prosecutors have called the largest pandemic fraud case in the country. Autism support centers are also subject to a separate fraud investigation. The ringleader of the food fraud scheme, Aimee Bock, was convicted of conspiracy to commit wire fraud and conspiracy to commit federal programs bribery for taking millions of dollars meant to feed hungry children. Seventy people are charged in the scheme, of whom 48 have been convicted. "These people are being arrested and they're going to prison," Walz added on Monday. "And right now the people involved in this, you will be going to prison. The U.S. attorney is on it."Caroline Cummings contributed to this report.
Axios
24-07-2025
- Politics
- Axios
Top federal prosecutor says Minnesota's fraud total could surpass $1 billion
Minnesota's acting U.S. Attorney Joe Thompson says his office has prosecuted a half billion dollars in fraud in state programs in recent years — and the total tally could double by the time it's done. The latest: FBI agents searched several properties last week in connection with what they called "massive" fraud involving Minnesota's Housing Stabilization Services program. The program, which started in 2020 and provided Medicaid dollars for housing for seniors and people with disabilities, paid out over $100 million in claims last year, over 38 times the initial cost estimates. The big picture: The latest investigation comes on top of the $250 million-plus Feeding Our Future scheme, which has already resulted in 48 guilty pleas or convictions. A separate Medicaid-funded program meant to serve people with autism continues to face scrutiny amid fraud concerns and a 2024 FBI raid. What they're saying: "It's an extraordinary problem, the fraud that's pervasive in this state," Thompson told KSTP in an interview this week. Prosecutors have called the new housing stabilization program, one of the first of its kind nationwide, "uniquely vulnerable to fraud." The other side: DFL Gov. Tim Walz defended his administration's handling of the issue in an interview with Axios this week, saying the prosecutions are "counterintuitively a good thing" because it means state and federal investigators are catching — and stopping — fraud. "We want to help people, but we need to be skeptical. And if there's any thought whatsoever [that] these people are doing this, we need to refer them over [to law enforcement]," he said. Zoom in: Walz noted that a recent change in law allowed the state Department of Human Services to freeze payments amid fraud concerns in the housing stabilization program. An FBI search warrant confirms that DHS stopped payments to at least two providers in May, shortly after the law passed. But by that point, the providers had already received millions in reimbursements for what investigators say were false claims, per a federal search warrant. Friction point: Once the money's out the door, it's difficult to claw back. The government has recovered just $60 million in the Feeding our Future case, per KSTP. What we're watching: DHS told the Star Tribune it's opened about 40 investigations into providers connected to a single building in the housing aid case "and stopped payments everywhere we have seen evidence of fraud." "You will see more people going to jail," Walz said of the broader fraud crackdown.
Fox News
18-07-2025
- Fox News
Patel touts FBI's dozens of convictions in $250 million Minnesota COVID scam
FIRST ON FOX: A $250 million fraud scheme that exploited a federally funded children's nutrition program during the COVID-19 pandemic has been described by FBI Director Kash Patel as "one of the worst" in Minnesota history. The FBI director told Fox News in a statement that 70 people in Minnesota have been indicted for their role in the sprawling "Feeding our Future" fraud scheme during the COVID-19 pandemic, which exploited a federal program designed to reimburse states for the cost of feeding children. Conspirators falsely claimed to have served millions of meals during the pandemic, but instead used the money for personal gain. Of the individuals indicted, 38 have pleaded guilty, FBI officials told Fox News Digital. More than a dozen of the individuals are awaiting criminal trial, with the next trial beginning in August. "Stealing over $250 million from hungry kids during a pandemic to fund mansions and luxury cars is as shameless as it gets," FBI Director Kash Patel said in a statement. "I'm proud of the FBI and our partners for dismantling this web of corruption, holding dozens accountable, and sending a clear message: if you exploit the most vulnerable, we will find you and bring you to justice." Conspirators charged in the scheme are accused of fabricating invoices, submitting fake attendance records, and falsely distributing thousands of meals from hundreds of so-called food distribution "sites" across the state — taking advantage of the U.S. Department of Agriculture's decision to waive, for the duration of the pandemic, many of its standard requirements for participation in the Federal Child Nutrition Program — including relaxing its requirement for non-school based distributors to participate in the program. Charging documents show that roughly 300 "food sites" in the state served little or no food, with the so-called "food vendors" and organizations fabricated to launder money intended to reimburse the cost of feeding children. FBI officials told Fox News that the investigation and resulting trials and indictments continue to impact the state, and have already touched off legislative reform in Minnesota. They added that the investigation into the fraud remains ongoing, and that additional charges are expected, though they did not immediately share more details. The next trial in the state is scheduled to begin on August 11. "Stealing from the federal government equates to stealing from the American people — there is no simpler truth," FBI's special agent in charge, Alvin Winston, told Fox News Digital in a statement. "The egregious fraud unveiled in the Feeding our Future case epitomizes a profound betrayal of public trust. These individuals misappropriated hundreds of millions in federal funds intended to nourish vulnerable children during a time of crisis, redirecting those resources into luxury homes, high-end vehicles, and extravagant lifestyles while families faced hardship," he added. "We will uncover their schemes, dismantle their networks, and ensure that they are held accountable to the fullest extent of the law," he said.
CBS News
01-07-2025
- Business
- CBS News
Boat permits, state constellation, anti-fraud measures: New Minnesota laws that take effect July 1
The Minnesota Legislature had a one-day June special session to complete the next $66 billion two-year state budget funding the state government and its programs and services. That spending kicks in July 1, along with a slate of new policies. The political makeup of the capitol is unique with a tied House for only the second time in state history. It's as closely divided as a Legislature can be in Minnesota — with 100 Republicans and 101 Democrats — which forced compromise. Here's a list of some of the new laws that take effect Tuesday: Boat permit requirements A bill approved two years ago takes effect Tuesday, requiring Minnesotans 21 and younger to have an operator's permit in order to drive a motorboat. That will expand to more age groups over the next several years. Anyone who rents a boat — regardless of their age — will need a permit, too. Anti-fraud measures In wake of high profile scandals like the Feeding Our Future scheme, the Legislature approved changes to increase oversight of public programs and prevent fraud. Under a new law, state agencies are allowed to withhold funding to organizations receiving state dollars for up to 60 days if there is significant evidence to suggest they have committed fraud. There is new training required for certain employees administering state grants and there are increased protections for whistleblowers who report wrongdoing. Lawmakers stopped short of passing an Office of Inspector General, an independent government watchdog agency, despite bipartisan support. Cannabis tax increase The gross receipts tax on cannabis sales increases from 10% to 15% before the legal adult-use market launches, despite pushback from the industry and advocates. It also applies to sales of hemp-derived THC edibles and beverages, which are already available on store shelves. New state symbols Minnesota has a state bird, drink, fish, flower and more. Now the giant beaver joins the list of state symbols as the state fossil, which got the most support when the Science Museum of Minnesota conducted a poll four years ago, according to the Legislative Reference Library. The Legislature also approved Ursa Minor, the "Little Dipper," as the state constellation. One of its stars is Polaris, "the North Star." Lane splitting for motorcycles Motorcyclists in Minnesota will be able to get through traffic jams a little quicker under a new law. Both "lane splitting" and "lane filtering" are legal starting Tuesday under certain circumstances. When there are two or more lanes of traffic going in the same direction, a motorcyclist can pass a vehicle in the same lane but no more than 25 miles per hour. Panel to find savings in special education Lawmakers are trying to pump the brakes on growing special education transportation costs, one of the largest drivers of a gap between spending and revenues that could lead to a deficit in future years. They trimmed how much districts are reimbursed by the state for those services — from 100% to 95% — and established a Blue Ribbon Commission on Special Education to find more savings in the next budget. Its charge is to "develop and present to the legislature and the governor an action plan for transforming special education services while maintaining a free appropriate public education for students with disabilities" by Oct. 1 of next year. Expanding access to opioid overdose-reversal drug Following a recent law requiring doses of opioid overdose-reversal drug naloxone in K-12 school buildings, the Minnesota Legislature authorized high school students to administer naloxone to other students as needed. Schools that are part of the Minnesota State system are required to keep a supply of at least two doses of the opiate antagonist in residential buildings. The Board of Regents governing the University of Minnesota are requested to implement the same policy.
CBS News
26-06-2025
- Business
- CBS News
Minneapolis man becomes 47th person convicted in $250 million Feeding Our Future fraud scheme
A 35-year-old Minneapolis man pleaded guilty to his role in what federal prosecutors say is the largest pandemic fraud case in the country, Acting U.S. Attorney Joseph H. Thompson announced Thursday. Court documents state that Ahmed Ghedi pleaded guilty to wire fraud and money laundering. His sentencing will be scheduled at a later date. He is the 47th person convicted in the $250 million Feeding Our Future fraud scheme, according to the U.S. Attorney's Office in Minnesota. Prosecutors say Ghed, like many of those convicted in the case, fraudulently claimed to be running a child nutrition site, feeding thousands of children a day in St. Paul and took federal COVID-19 relief funds to do so. Over nearly one year, Ghedi deposited more than $2 million in Federal Child Nutrition Program funds into the bank account of a shell company he created, according to court documents. He used the funds to purchase more than $245,000 in motor vehicles and more than $200,000 in credit card spending. Additionally, Ghedi used approximately $560,000 in fraudulently obtained funds towards the purchase of a mansion-turned-office building and adjoining property in south Minneapolis. Both the property and a 2021 Jeep Grand Cherokee will be forfeited to the United States, prosecutors say. Ghedi reportedly paid a Feeding Our Future employee $5,000 in kickbacks in exchange for sponsoring his business's participation in the program. His company then paid the same employee an additional $49,000 in kickbacks. Court documents say Feeding Our Future received nearly $400,000 in administrative fees for sponsoring the participation of Ghedi's business in the program. The U.S. Attorney's Office in Minnesota says Ghedi received $7.2 million total from the Federal Child Nutrition Program through fraudulent claims. Earlier this year, Aimee Bock was found guilty on multiple criminal counts, including conspiracy to commit wire fraud and conspiracy to commit federal programs bribery. Bock, the founder and executive director of Feeding Our Future, was found in court to have orchestrated the defrauding of the Federal Child Nutrition Program out of a quarter of a billion dollars. Salim Said, a co-defendant in Bock's trial, was also convicted on multiple counts. Dozens of people were charged in connection with the scheme.
