ST. PAUL, Minn. — Federal agents carried out search warrants Tuesday in the Twin Cities “relating to the rampant fraud of U.S. taxpayers dollars,” according to the U.S. Department of Homeland Security.

“The American people deserve to know how their taxpayer money was abused,” a Homeland Security spokesperson said in a statement. “… No stone will be left unturned.”

The search warrants were at autism centers and childcare centers, according to the Minnesota departments of Human Services and of Children, Youth, and Families.

Homeland Security Investigations, working with law enforcement partners, carried out the warrants in Minneapolis, the U.S. DHS statement said. The FBI’s Minneapolis office said they are “involved in court-authorized law enforcement activity at various locations around the metro area as part of an ongoing criminal investigation.”

Vice President JD Vance wrote on X: “The task force and the DOJ will be relentless in exposing these fraudsters wherever they may be hiding.”

Gov. Tim Walz said “securing justice depends on” joint investigations.

“If you commit fraud in Minnesota you’re going to get caught — and that’s exactly what we saw today,” Walz wrote on X Tuesday. “Today’s raids by state and federal law enforcement happened because our state agencies caught irregular behavior and reported it. That’s how the system is supposed to work, and our agencies will keep at it as long as there are fraudsters around to put behind bars.”

Minnesota fraud has been described as “industrial scale” by former Assistant U.S. Attorney Joe Thompson, who speculated total losses in Medicaid programs alone could top $9 billion since 2018. In a recent report, Gov. Tim Walz’s director of Program Integrity, Tim O’Malley, blamed fraud problems on a culture in state agencies “more based on compassion than compliance.”

Reports of 20+ locations raided

The U.S. Department of Health and Human Services said in January that it was pausing federal funding to child care subsidies and other social service programs in Minnesota and four other states because it had “reason to believe” the states were granting benefits to people in the country illegally.

In a hearing in a federal court in January, a government attorney said the concerns were raised by media reports, though she told the judge she did not know which ones. Federal officials have previously cited a viral video that claimed to show fraud at Minneapolis day care centers operated by people with Somali backgrounds.

In the video, YouTube creator Nick Shirley visits numerous day cares, including Quality Learning Center (misspelled “Learing” on a sign), which had already been under investigation by state officials for various violations and had collected $7.8 million from the state since 2019, according to a report by KSTP-TV.

Homeland Security shared a screenshot on X Tuesday of a Daily Caller headline that said, “Feds raid infamous ‘Quality Learing Center,’ other businesses tied to alleged Somali fraud.” The federal agency wrote in the same post that Homeland Security Investigations and HSI’s St. Paul field office “are zeroing in on the rampant fraud of taxpayer dollars.”

U.S. House Majority Whip Tom Emmer, R-Minnesota, applauded reports of agents raiding more than 20 locations.

“President Trump and his administration have made it crystal clear — our country will not tolerate waste, fraud, and abuse, and we are not going to allow people to take advantage of Americans’ generosity,” he said in a statement. “Thank you to the U.S. Department of Justice and the Department of Homeland Security for taking action against Somali fraudsters. Minnesotans and U.S. taxpayers across the nation are grateful.”

Minnesota Senate Republican Leader Mark Johnson, of East Grand Forks, criticized Walz.

“When Walz took office in 2019, reports of massive childcare fraud began exploding across the headlines,” he said in a statement. “Seven years later, Minnesota is still grappling with systemic abuse; not only in childcare, but in housing assistance, support for vulnerable adults, medical transportation, and more.”

State agencies say they’re working to root out fraud

The Minnesota Department of Children, Youth, and Families said Tuesday’s law enforcement actions “are a result of state, county, and federal agencies working together to root out fraud and hold bad actors accountable.”

The agency said in a statement that they’re “pleased to see the state’s Bureau of Criminal Apprehension and our federal partners taking strong action based on information we have shared with them. We will continue sharing information with law enforcement to ensure they are able to conduct thorough criminal investigations.”

Minnesota Human Services Commissioner Shireen Gandhi said the search warrants at autism centers are “an important action for families who rely on autism services and for Minnesota taxpayers fed up — as I am — with criminals taking advantage of the systems we have in place to deliver social services. Our primary goal remains — to make Minnesota’s Medicaid program the best in the nation for program integrity.”

The Minnesota Department of Human Services said they continue “taking significant steps to investigate fraud” and, when they “find credible evidence” of it, they turn information over to law enforcement.

“In addition to providing investigatory information, including billing information, ownership information, case files and notes and treatment records to state and federal investigators, DHS staff has also met with federal law enforcement officials to educate them about EIDBI (Early Intensive Developmental and Behavioral Intervention) services and potential vulnerabilities in the program,” DHS said in a statement.

DHS stops payments “as soon as we establish credible allegations/evidence of fraud,” the statement added. “… DHS also is taking action to prohibit new providers, require additional oversight through high-risk designation, utilize enhanced pre-payment review, and revalidate the current providers’ credentials so that the providers receiving Medicaid funds have the right credentials and are billing for the appropriate services.”

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