HHS freezes all child care payments to Minnesota over fraud allegations

The Department of Health and Human Services (HHS) has frozen all child care payments to Minnesota due to widespread fraud allegations. The investigation centers on Somali-run day care centers suspected of misusing millions in taxpayer dollars intended for children. HHS Deputy Secretary Jim O'Neill announced three actions: requiring evidence for all payments, demanding a comprehensive audit from Minnesota Governor Tim Walz, and establishing a hotline for reporting fraud. O'Neill stated that funds will be released once states prove legitimate spending. Governor Walz, however, suggested the move was politically motivated by the Trump administration to defund programs. He asserted that his administration has already been working to combat fraud. The scrutiny intensified following a viral video highlighting the state's scandal. HHS estimates that Minnesota receives $185 million annually for child care, benefiting approximately 19,000 children. Minnesota officials claim previous investigations found no fraud, but are re-examining centers in light of the recent concerns.