It was only a few years ago when Republicans would discuss fraudulent activity within state government that Democrats would laugh at us. “Fairy dust” is what one called it, basically suggesting that anyone making this statement was living in a land of make-believe.
Today, Minnesotans have almost become numb to fraud reports. Because they happen so often, they’re not even surprised by the news anymore. Truly, it’s not uncommon to hear about a new scam once a month.
Minnesota’s Housing Stabilization Services program, once touted as a lifeline for vulnerable residents, has become the latest cautionary tale of government failure and unchecked fraud. It began in 2020 to help people with disabilities and mental health challenges find stable housing. Initially projected to cost $2.6 million a year, program costs exploded to more than $100 million four years later. That kind of runaway growth should have immediately triggered scrutiny. Instead, it flew under the radar—at least within the Minnesota Department of Human Services.
There were plenty of red flags. A single office building in St. Paul somehow became the home of 22 different housing providers, many of whom are now under federal investigation.
When a program grows this fast and flies this far off course, the conclusion is unavoidable: meaningful oversight was absent from day one. This is especially true when you realize none of this fraud would have come to light if not or the work of investigative reporters and the U.S. Attorney’s Office.
As a result, the Walz administration recently shut down the program entirely.
The worst example of fraud in our state is the Feeding Our Future scandal, which just saw its 50th criminal conviction. It is the largest scam in our nation’s history at more than $250 million stolen.
Unfortunately, there are many more examples that have occurred on Governor Walz’s watch:
Child care/CCAP: $150 million
NUWAY (addiction outpatient services): $58 million
Frontline workers: $45 million
Provider overpayments: $40 million
Evergreen Recovery: $30 million
Sober homes: $28 million
Medicaid: $50 million
Unemployment benefits: nearly $9 million
Minnesota autism centers: nearly $2 million
To date, roughly $650 million in fraudulent activity has been brought to light. But U.S. Attorney Joe Thompson recently said he believes the scope of fraud in Minnesota government programs could exceed more than $1 billion.
This is why we pushed for legislation last session creating an independent Office of Inspector General that could investigate fraud on its own and refer cases for criminal prosecution when needed. It would be its own entity and not under Governor Walz’s or any future governor’s control in any way.
The Minnesota Senate passed similar legislation with near unanimous support this session, yet House Democrats refused to allow a vote on it.
Which begs the question: why?
Fraud is literally running rampant in Minnesota. No other state has these problems. No one within any of these government agencies is ever held accountable, and it often feels like no one is even attempting to stop it. And yet, when it came time to enact meaningful change to prevent future taxpayer theft, House Democrats stood in the way.
What do you think? Is state government fraud much ado about nothing, clear signs of larger mafia-like organized crime activity happening throughout Minnesota state government, or somewhere in between?
To me, at some point we must recognize that continued fraud activity in our state is not a coincidence. We owe it to taxpayers to end this abuse of their tax dollars. It is a serious problem that demands a serious solution, and not just another shrug of the shoulders when Minnesota learns of continued (and apparently, inevitable) fraudulent activities in the months ahead.