Over $1 billion in taxpayer money was stolen from Minnesota’s social safety net programs under Tim Walz’s watch, exposing how liberal fear of being called “racist” enabled the largest welfare fraud scandal in state history.
Story Snapshot
- Federal prosecutors convicted 59 people in three massive fraud schemes totaling over $1 billion stolen from Minnesota taxpayers.
- Walz administration officials ignored red flags due to fear of racism accusations, allowing fraud to continue unchecked.
- President Trump called Minnesota a “hub of fraudulent money laundering activity” and ended temporary legal status for Somali immigrants.
- Republican challenger Lisa Demuth makes fraud a central campaign issue, accusing Walz of raising taxes while letting “fraud run wild.”
Billion-Dollar Theft Exposes Administrative Failures
Federal prosecutors have convicted 59 individuals in three separate fraud schemes that drained over $1 billion from Minnesota’s taxpayer-funded social programs. The stolen amount exceeds Minnesota’s entire annual Department of Corrections budget.
The schemes targeted pandemic child nutrition programs, homelessness assistance, and autism therapy services. Most fraudsters created fake companies, billed state agencies for services never provided, and spent the proceeds on luxury cars, houses, and overseas real estate investments.
A damning quote on Tim Walz’s failure to stop the fraud consuming Minnesota.
"No one was doing anything about the red flags," he said. "It was like someone was stealing money from the cookie jar and they kept refilling it."
WOW. pic.twitter.com/jRLvSZ9HVa
— Dustin Grage (@GrageDustin) November 29, 2025
Political Correctness Enabled Massive Theft
State officials repeatedly ignored obvious red flags because they feared being labeled racist, according to federal prosecutor Joseph Thompson. When the Minnesota Department of Education questioned suspicious claims, Feeding Our Future, a nonprofit, threatened lawsuits alleging racism that would be “sprawled across the news.”
The threat worked—state agencies continued approving fraudulent claims and new feeding sites. A legislative audit confirmed that litigation threats and negative press concerns affected how officials used their regulatory power.
Walz Administration Prioritized Politics Over Taxpayers
Former fraud investigator Kayseh Magan explained that Walz’s Democratic administration was “reluctant to take more assertive action” because the Somali community represents “a core voting bloc” for Democrats.
The administration’s fear of political backlash allowed criminals to exploit generous safety net programs designed with minimal oversight.
Even as fraud ballooned—one housing program exploded from a $2.6 million budget to $104 million annually—Walz’s team continued rubber-stamping suspicious claims rather than protecting taxpayer dollars.
Trump Takes Action While Democrats Make Excuses
President Trump has rightly called Minnesota “a hub of fraudulent money laundering activity” and ended temporary legal status for hundreds of Somali immigrants following these revelations.
Meanwhile, Walz continues making excuses, claiming his administration “erred on the side of generosity” during the pandemic. This represents exactly the kind of fiscal irresponsibility that drove inflation and government waste under the previous administration.
Taxpayers deserve leaders who protect public funds, not politicians who prioritize political correctness over accountability.
