Testifying before a U.S. House oversight panel Wednesday, Minnesota Gov. Tim Walz and Attorney General Keith Ellison clashed with Republican members of Congress over their handling of significant fraud in state government programs funded by the federal government.
Walz told the Republican-led House Oversight and Government Reform Committee that he accepted responsibility for his administration’s handling of recent fraud scandals — though in his opening remarks, he said he believed the state had become a target of unfair persecution by the Trump administration.
“The people of Minnesota have been singled out and targeted for political retribution at an unparalleled scale. Including blocking Medicaid reimbursements for our state just last week,” he said, referencing the Trump administration’s withholding of roughly $250 million in annual Medicaid funding from the state over fraud concerns.
The House Oversight Committee called on the Democratic state leaders to appear as part of its ongoing probe into fraud in Minnesota government programs, which have lost hundreds of millions of dollars to theft in recent years. Wednesday’s four-and-a-half-hour hearing was the second the committee has held on the state’s fraud issues this year.
Federal prosecutors have estimated fraud in 14 “high-risk” Medicaid programs alone could top $9 billion since 2018, though this number has not been proven and has been dismissed as speculative by the Walz administration.
‘Billions of taxpayer dollars were stolen’
Ahead of the hearing, GOP members published a 54-page report titled “The Cost of Doing Nothing: How Tim Walz and Keith Ellison Fueled Minnesota’s Fraud Explosion,” which claimed the leaders were aware of fraud issues in the state Department of Human Services and Department of Education as early as 2019 but didn’t act urgently to address the issue.
“Billions of taxpayer dollars were stolen from social service programs while warnings piled up, whistleblowers spoke out and state officials chose delay and denial over action,” said Rep. James Comer, a Kentucky Republican and chair of the committee.
Walz and Ellison defended their response to government program fraud and told the committee that the Trump administration’s immigration enforcement surge had hurt the state’s ability to fight fraud.
Many prosecutors resigned at the Minnesota U.S. Attorney’s office in January, reportedly amid pressure from the Trump administration to investigate the widow of Renee Good, who was shot and killed by an immigration agent in Minneapolis during the crackdown.
The U.S. Attorney’s office had been the primary engine for accountability in Minnesota fraud cases. It had charged more than 100 people in cases ranging from Medicaid fraud to the $250 million Feeding Our Future Case.
With few prosecutors remaining at the office and a wave of immigration cases following the enforcement operations, work on fraud cases is likely to suffer, Ellison said.
“Operation Metro Surge did nothing to address fraud in our state. It harmed our economy, it scarred our people and it dealt a devastating blow to fraud enforcement in Minnesota,” he told the committee. “We cannot combat fraud without consistent messaging and support from our political leaders.”
Walz: ‘I’ve taken accountability for this’
While answering questions from Rep. Pete Sessions, R-Texas, Walz admitted fraud had happened under his watch and took responsibility for what had unfolded in recent years.
“I’ve taken accountability for this. I’m not going to run again. I need to spend time fixing this,” he said. “I’m certainly not proud this happened, I certainly understand it happened under my watch, whether it predated me or not, I’m here.”
Walz, who suspended his campaign for a third term in office in January amid growing scrutiny on his record managing fraud, pointed to recent actions his administration has taken to address the problem.
Those include efforts to audit programs, the appointment of a top anti-fraud official and the shuttering of a housing program beset by fraud after several providers were charged in federal fraud cases.
The state attorney general’s office, meanwhile, has pointed to its record of prosecuting Medicaid fraud, noting that it had tackled over 300 cases and “won over $80 million in recoveries” for the state.
Rep. Clay Higgins, R-La., and Rep. Tim Burchett, R-Tenn., accused Ellison of not doing enough to investigate fraud and called on him to resign.
“This is money that’s been stolen and it will not be recovered and you all are to blame,” Burchett said. “Every dadgum one of you all ought to step down.”
Democrats focus on immigration action
As GOP lawmakers pressed Walz and Ellison on fraud, Democratic members of the committee used much of their time attempting to shift the focus of the hearing to the Trump administration’s recent immigration crackdown in Minnesota.
Thousands of federal agents were deployed in the state following allegations of widespread fraud by Minnesota’s sizeable Somali immigrant community. A majority of defendants in recent Minnesota’s federal fraud cases are of Somali descent.
Rep. Yassamin Ansari, D-Ariz., had a staff member hold up a large photo of Alex Pretti, another Minnesotan shot and killed by immigration agents in January, called the hearing on fraud an “outrageous use” of the committee’s time and asked Walz and Ellison about the federal government’s unwillingness to allow local law enforcement take part in the investigation of Pretti’s killing.
Democrats called Rev. Mariah Tollgaard, a senior pastor at Hamline Church United Methodist in St. Paul, to testify on how the operation affected immigrant communities in the Twin Cities. St. Paul Schools, as one example, has recently started offering remote learning for students from families worried about being arrested by immigration agents.
“This fraud has been used as the rationale for deploying 3,000 federal immigration enforcement agents into our state — in operations that target the most vulnerable among us, but are indiscriminately impacting all of us,” she told the committee in her opening statement.
U.S. Rep, Tom Emmer presses Ellison on Feeding Our Future fraud
Republican Minnesota Rep. Tom Emmer pressed Ellison for details on when he became aware of the $250 million Feeding Our Future fraud scheme, where a ring of mostly Somali fraudsters claimed reimbursement for meals they never served to children as part of a pandemic-era meal program.
Rep. Tom Emmer, R-Minn. (AP Photo/Tom Brenner)
Ellison held a meeting in December 2021 that involved people who were eventually charged — just a month before the FBI investigation became public. The group sought Ellison’s help in a dispute with the state Department of Education, which had suspended funding for meal programs amid fraud suspicions.
Ellison has said he was not aware he was meeting with fraudsters at the time, though his office distributed a news release in September 2022 saying it had been involved with the FBI’s investigation for two years.
A person connected to a Feeding Our Future defendant made a contribution to Ellison after the meeting, though the Attorney General returned it after the cases became public. His office also says it never acted on any of the requests from the meeting, despite Ellison telling the group he would “demand some explanations” from the Minnesota Department of Education.
Emmer explained the meeting and timeline, and then asked Ellison when he became aware of the FBI’s investigation.
“As you know, I have addressed this issue many times,” Ellison said before Emmer cut him off.
“We are left with two questions,” Emmer later said. “One, what did Gov. Walz and Keith Ellison know about the fraud? And two, when did they actually know it? I would suggest that if they do not give direct and truthful answers to both these questions at this hearing, then they both need to be put under oath in a deposition.”
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