Minnesota has faced a series of major fraud scandals in taxpayer-funded social services programs, with federal prosecutors charging over 90 individuals—predominantly of Somali descent—in schemes totaling hundreds of millions in documented losses, and estimates suggesting potential theft exceeding $1 billion across multiple programs. The most prominent case is the Feeding Our Future scandal, involving a nonprofit that allegedly stole around $300 million from federal child nutrition programs during the COVID-19 pandemic by claiming to feed millions of nonexistent children. Prosecutors have secured dozens of convictions, describing it as the largest pandemic-relief fraud in U.S. history.Related schemes targeted Medicaid-funded services for autism therapy and housing stabilization, where defendants billed for nonexistent treatments or services, often recruiting participants from the Somali community with kickbacks. As of late 2025, federal authorities have convicted over 60 people and continue investigations into 14 high-risk programs totaling $18 billion in spending since 2018, with a prosecutor estimating half or more may involve fraud.The vast majority of charged defendants (e.g., 82 of 92 across key cases) are Somali Americans, many U.S. citizens by birth or naturalization, though not all. Funds were allegedly used for luxury purchases like cars, homes, and overseas real estate, primarily in Kenya.Claims that stolen money directly funded the Somali terrorist group al-Shabaab remain unproven and disputed. Conservative outlets like City Journal alleged links via remittances, prompting Treasury investigations, but federal prosecutors, including the U.S. Attorney's Office, and sources like CBS News and the Minnesota Reformer state there is no evidence of intentional terrorism financing. Any indirect flow (e.g., via taxation in Somalia) is speculative and not charged.Critics, including President Trump and Republican officials, have highlighted oversight failures under Gov. Tim Walz, accusing reluctance to investigate due to fears of racism accusations. Walz has acknowledged shortcomings, implemented reforms like audits and pauses on payments, and condemned broad attacks on the Somali community (estimated at 80,000–100,000 in Minnesota) as unfair stereotyping.Somali leaders emphasize that fraud involves individuals, not the community, which includes many contributors in business, politics, and public service. Earlier similar allegations (e.g., 2018 child care fraud) were investigated and found unsubstantiated regarding terror links.For detailed coverage:New York Times overview of the scandals.

CBS News on lack of terror evidence.

AP News summaries of charges and political context.

Star Tribune local reporting on community impact and totals.

These cases highlight systemic vulnerabilities in program oversight, not inherent to any ethnic group. Ongoing federal probes may reveal more.