The Office of the Legislative Auditor in Minnesota released a scathing report accusing the Minnesota Department of Education of inadequately overseeing a federal program aimed at providing food to children. This lack of oversight created opportunities for the theft of $250 million in what is described as one of the country’s largest pandemic aid fraud cases. The report highlighted the department’s failure to act on warning signs and hold Feeding Our Future accountable to program requirements. The agency was also deemed ill-prepared to respond to the issues it encountered with the organization.
Seventy individuals have been charged in federal court for their alleged roles in the scheme, which prosecutors claim revolved around a nonprofit called Feeding Our Future. Five of the first seven defendants to stand trial were convicted, with 18 others having already pleaded guilty. Education Commissioner Willie L. Jett II defended the agency’s oversight, stating that the department met applicable standards and made effective referrals to law enforcement. He attributed the blame for the fraud to the indicted and convicted fraudsters within Feeding Our Future.
Republican legislative leaders criticized the administration of Democratic Gov. Tim Walz, accusing them of failing to stop the fraud despite red flags. The GOP leaders argued that the Department of Education and Gov. Walz did not do enough to prevent the fraudulent activities. Some Democrats also expressed disappointment during a hearing on the report, noting that past commissioners of the agency did not exercise their authority to prevent and report fraud. The lack of accountability within the department was highlighted as unacceptable by lawmakers.
The pandemic disruption was cited as no excuse for the rampant fraud, which exploited lax rules to prevent an economic crash. The FBI began investigating the scheme in spring 2021, revealing a complex web of fraudulent activities such as producing fake invoices, running shell companies, and engaging in money laundering. Despite efforts to recover the stolen funds, only about $50 million has been retrieved out of the $250 million taken in the Minnesota scheme. Changes have been implemented within the Department of Education to strengthen oversight capabilities and prevent future fraud, including the establishment of an office of inspector general and updated fraud-reporting policies.
An Associated Press analysis revealed widespread fraud in federal COVID-19 relief programs, with billions of dollars being stolen across the country. The losses amounted to $280 billion in stolen funds and an additional $123 billion wasted or misspent. This constituted 10% of the $4.3 trillion disbursed by the government. Nearly 3,200 individuals have been charged in connection with the fraud, and approximately $1.4 billion in stolen aid has been seized by the Justice Department. The Feeding Our Future case in Minnesota is just one example of the larger issue of pandemic aid fraud that has plagued the country.
