The Trump administration has abruptly suspended federal funding for childcare programmes in the US state of Minnesota, citing allegations of widespread fraud within the system.
Funding Halted Over 'Rampant' Fraud Claims
Jim O’Neill, the deputy secretary of health and human services, announced the freeze in a video statement on Tuesday. He claimed the action was a direct response to "blatant fraud that appears to be rampant in Minnesota and across the country." O’Neill stated, "We have turned off the money spigot and we are finding the fraud." The official credited right-wing influencer Nick Shirley, whose recent video from Minneapolis gained traction online, for bringing renewed attention to the issue.
A Long-Running Scheme and Political Fallout
However, the fraud allegations are not new. Federal prosecutors have been investigating and prosecuting a major scheme for years. The cases began with indictments in 2022 against 47 defendants for their alleged roles in a $250m fraud that exploited a federally funded child nutrition programme during the Covid-19 pandemic. To date, 57 people have been convicted for stealing funds from the non-profit Feeding Our Future.
A federal prosecutor alleged earlier in December that a staggering portion of federal funds in Minnesota may have been stolen, suggesting half or more of the roughly $18bn supporting 14 programmes since 2018 was affected. Most defendants in these cases are Somali Americans.
Former President Donald Trump has used these allegations to promote calls to ban refugees from Somalia and to attack Minnesota's Democratic Congresswoman, Ilhan Omar. Omar has urged the public not to blame an entire community for the actions of a few.
Minnesota's Response and Accusations of Politicisation
Minnesota's Governor, Tim Walz, who is the 2024 Democratic vice-presidential candidate, strongly criticised the funding freeze. "This is Trump’s long game," Walz wrote on social media. "We’ve spent years cracking down on fraudsters. It’s a serious issue – but this has been his plan all along. He’s politicising the issue to defund programmes that help Minnesotans."
Walz has long defended his administration's response, stating that fraud will not be tolerated and that they continue to work with federal partners. An audit due by late January is expected to provide a clearer picture of the fraud's extent.
Alongside the freeze, O’Neill announced new nationwide measures for payments through the Administration for Children and Families, including requiring "justification and a receipt or photo evidence" before funds are released. A new fraud reporting hotline and email address have also been launched.
