Feds announce charges ‘unprecedented’ Medicaid fraud scheme in Minnesota

Top Trump administration officials traveled to Minnesota on Thursday, May 21, to announce federal charges against 15 people in what they called the largest Medicaid fraud case ever brought in Minnesota.

“We’re going to protect these programs and protect vulnerable children and restore integrity to the American health care system,” said Robert F. Kennedy Jr., the secretary of U.S. Department of Health and Human Services.

Kennedy was joined by Centers for Medicare and Medicaid Services Administrator Dr. Mehmet Oz, U.S. Attorney for Minnesota Daniel Rosen and other federal and state law enforcement officials to announce the indictments at the federal courthouse in downtown Minneapolis.

The 15 individuals are charged with targeting over $90 million across seven Medicaid programs aimed at helping the state’s most vulnerable, including homeless people, children with autism and disabled people.

“These disabled individuals were used like lottery tickets by these defendants to generate millions of dollars, which these defendants used to expand their real estate holdings, purchase luxury vehicles, and splurge on expensive jewelry,” said Colin McDonald, assistant attorney general for the National Fraud Enforcement Division.

McDonald also announced the expansion of the Midwest Healthcare Strike Force team with additional prosecutors in Minnesota, and the creation of a new Medicaid strike force team with 15 attorneys to work across the country.

The additions come as the Department of Justice in Minnesota faces a wave of resignations of career prosecutors including former assistant U.S. Attorney Joe Thompson, who previously oversaw the sprawling investigation into social service fraud in Minnesota. The resignations were driven in part by the politicization of the Justice Department under President Donald Trump and its handling of Operation Metro Surge.

The officials at the press conference did not provide details like names or the specific charges leveled, though they did present a blurry photo of one person — Muhammad Omar — who they said is on the run and asked for the public’s help in locating.

The news conference coincided with a federal judge handing down a nearly 42-year prison sentence for Aimee Bock, the ringleader of what prosecutors called the nation’s largest pandemic fraud scheme that siphoned $242 million from a federal child nutrition program through her nonprofit Feeding Our Future. Other fraudsters stole tens of millions more from the food program.

The 66 people who have been convicted in the case bought luxury cars, waterfront properties and lavish vacations.

Since the first charges in the Feeding Our Future scheme were announced in 2022, federal and state authorities have uncovered significant fraud and waste across social service programs, leading Minnesota officials to designate 14 Medicaid programs as “high risk” for fraud.

While most of the charges in the Feeding Our Future scheme were brought under the Biden administration, the Trump administration has claimed the issue with a War on Fraud led by Vice President JD Vance.

That so-called war has largely focused on blue states including California, New York and Maine even though federal data suggest fraud of social service programs is no less prevalent in Republican-led states.

Indeed, Trump has granted clemency to dozens of donors and supporters convicted of fraud, including those who have stolen tens of millions in Medicaid dollars. McDonald declined to answer a question Bock or other convicted fraudsters in Minnesota can expect the same leniency.

Contributed

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Max Nesterak / Minnesota Reformer

Some of the indicted individuals were featured in a viral video by conservative YouTuber Nick Shirley, who was among the press corps at Thursday’s news conference in his signature “Quality Learing Center” hoodie, a reference to an infamously misspelled sign for a daycare that Shirley filmed.

Oz asked Shirley to stand up to be recognized during the news conference. Shirley claimed to have uncovered more than $100 million in fraud in Minnesota’s childcare program in the video shared by Vance and Elon Musk. While that figure hasn’t been substantiated, his video nevertheless helped draw the Trump administration’s attention to fraud in the state.

Most of those charged in defrauding government-funded services in recent years in Minnesota are of Somali descent, which Trump administration has used to justify vicious attacks on the state’s Somali population, culminating in the incursion of thousands of federal immigration agents here for Operation Metro Surge.

McDonald declined to answer a question about the conduct of federal agents during that operation, which left two Americans dead.

The Trump administration threatened to cut roughly $350 million in Medicaid payments to Minnesota in response to fraud, and Oz said on Thursday the state has still not done enough to restore funding even though his own agency approved Minnesota’s corrective action plan.

State officials say the cuts, known as deferrals, threaten health care services for the state’s most vulnerable residents.

Minnesota Reformer is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Minnesota Reformer maintains editorial independence. Contact Editor J. Patrick Coolican for questions: info@minnesotareformer.com.