WASHINGTON – A Republican-led House panel completed its probe into allegations of fraud in Minnesota’s social service programs and urged Vice President JD Vance to dive deeper into a matter it said was ignored by Gov. Tim Walz for political reasons.
The House Oversight and Government Affairs Committee, led by Rep. James Comer, R-Ky., has been investigating allegations that Walz and Attorney General Keith Ellison ignored rampant fraud in the state’s social service programs, which are funded wholly or in part by federal dollars.
The 205-page document alleged that little was done to stop fraudulent activity – including false vendors and kickbacks.
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The report released Monday, titled “The Cost of Doing Nothing: How Tim Walz and Keith Ellison Fueled Minnesota’s Fraud Explosion,” appears to contain little new from a preliminary report released in March.
Walz and Ellison, both of whom have appeared before Comer’s committee, have denied the allegations.
“Republicans in Congress issued a report riddled with inaccuracies and misrepresentations in an effort to politicize the issue of fraud, instead of actually helping Minnesota protect tax dollars and go after fraudsters,” said Ellison spokesman Brian Evans.
Testifying before lawmakers in March, Walz admitted that fraud happened on his watch but said some of the problems may have predated his administration. He also said he was taking steps to prevent it from occurring again.
Walz spokesman Teddy Tschann called Comer’s panel “nothing more than a joke” and said its allegations were meant to “distract from endless wars, gas prices, ICE and the president’s insider trading.”
“Gov. Walz is glad to see fraudsters are going to prison,” he said. “If the committee is concerned about corruption, they should investigate why President Trump continues to let fraudsters out of prison.”
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The wrap-up of the congressional investigation does not mean an end to the probes.
Comer, in a letter to Vance, who is heading a new anti-fraud panel, urged him “to conduct a thorough review of all of Minnesota’s social services program integrity measures, oversight processes, reimbursements, and enrollment from 2019 to the present.”
But there is a question of how much more scrutiny can be applied to Minnesota’s social service programs, which are already under investigation by the Trump administration with millions of federal dollars withheld as a result of those probes and billions more under threat.
‘A Smoking Gun’
The report drew on congressional testimony and private interviews of former and current Minnesota agency officials and emails from anonymous “whistleblowers” who said they faced retaliation when they sought to report fraud.
Among those questioned behind closed doors was former DHS Commissioner Tony Lourey, who testified that he communicated with Chris Schmitter, Walz’s former chief of staff, in 2019 about concerns involving the Child Care Assistance Program, non-emergency medical transportation and other state programs.
Former DHS Commissioner Jodi Harpstead also told the panel’s investigators that she reported fraud concerns to the governor’s office and the attorney general’s office, according to a transcript of her interview.
The report also rehashed the Feeding our Future scandal, a pandemic-era scheme to steal money that was meant to feed children.
It also said Walz and Ellison were “aware of credible and systemic fraud in Minnesota’s social services programs as early as 2019 but failed to take action to protect taxpayer funds.”
And it said the governor and attorney general took no action to protect Minnesota’s Somali community and protect them from losing its political support. Many of the defendants in the Feeding our Future scandal are Somali.
Evans said Ellison “fought fraud wherever possible and as soon as he was able to.”
With authority over Medicaid fraud, Ellison has convicted more than 340 Medicaid fraudsters, Evans said.
“In fact, Attorney General Ellison’s Medicaid Fraud Control Unit regularly ranks as one of the most effective Medicaid fraud-fighting units in the nation,” Evans said.
Evans also said that in areas where Ellison has not had criminal jurisdiction, he has defended the state from frivolous litigation filed by fraudsters to hide their schemes, assisted federal authorities in their investigations and used his authority to regulate charities to investigate and shut down charities used to perpetrate fraud.
Last month federal officials announced criminal charges against 15 people in connection with Medicaid fraud schemes in Minnesota that involved more than $90 million.
Medicaid providers appeal
Facing the threat of losing $2 billion in federal money for its Medicaid program, known in Minnesota as Medical Assistance, DHS has disenrolled about two-thirds of more than 5,400 providers in 14 categories of Medicaid services that were considered “high-risk” for fraud.
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On Monday, DHS said nearly 2,000 disenrolled providers have appeals in progress already, “with more coming in daily.”
Minnesota’s food stamp program is under investigation, as are other social service programs, including school meals and daycare services. The Trump administration has already withheld about $185 million in childcare funds.
Rep. Tom Emmer, R-6th District, whose son Jack Emmer is a prosecutor on the House Oversight and Government Affairs Committee, praised the panel’s work in a statement.
“Fraudsters may be holding the smoking gun, but Tim Walz and Keith Ellison handed it to them, locked and loaded,” Emmer said.
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