A former fraud investigator from Minnesota has alleged that state officials pressured him to conceal a childcare scam involving the Somali community nearly a decade ago.
Jay Swanson, who served as a fraud investigator within Minnesota’s Department of Human Services (DHS) from 2014 to 2018 after his career as a state trooper, made these startling claims during a testimony on Tuesday.
His statements coincided with federal agents conducting raids on over 20 businesses in Minneapolis as part of the Trump administration’s efforts to combat fraud.
Addressing the Minnesota House Fraud Prevention and State Agency Oversight Policy Committee, Swanson asserted that the state had attempted to suppress fraud allegations long before accusations arose that Governor Tim Walz halted these investigations.
“Reflecting with the clarity of hindsight, I realize that our team was witnessing the beginnings of a loosely organized criminal network exploiting Minnesota’s public benefit system,” Swanson remarked.
He further noted that his team discovered that among Somali refugee communities, it was widely known that Minnesota was a prime location for fraudulent activities.
‘They had heard you could run the scam in a number of different states, but it was easiest, and you could make the most money doing it in Minnesota,’ he said.
Swanson recounted several examples of children’s care centers that were giving kickbacks and billing the state for millions of dollars even though they had no students.
Former Minnesota fraud investigator Jay Swanson claimed that he was ‘bullied’ by state officials to cover up the Somali childcare scam nearly ten years ago
Federal agents raided more than 20 businesses as part of the Trump administration’s crackdown on fraud in Minneapolis on Tuesday
He said when his team reported this finding, they were ‘harassed and bullied’ by officials.
‘I soon had a senior DHS official in my office, angry, red-faced, and almost yelling. The senior DHS official told me to delete a number of paragraphs of the document. I then advised this official that I believed what they were telling me to do was illegal,’ Swanson testified.
‘I can’t tell you how shocked we were to come to the Department of Human Services and learn after a few years that not only was the theft of untold millions of dollars tolerated, but those who tried to stop it would be subjected to the wrath of high-ranking department officials.’
Swanson claimed that his unit’s findings were ignored, and officials even hired a consultant to discredit them and ‘shoved it under the carpet.’
‘Their only goal was to destroy our unit,’ he said.
The Daily Mail contacted Minnesota’s DHS for comment.
Donald Trump said Somalis were ‘completely taking over’ Minnesota and accused the community of widespread fraud, which prompted the massive, unprecedented immigration enforcement operation.
The state was already under a microscope for fraudulent activity following the Feeding Our Future scandal.
Swanson testified the state ‘tried to cover up fraud allegations’ years before Governor Tim Walz was accused of shutting the investigations down
Donald Trump said Somalis were ‘completely taking over’ Minnesota and accused the community of widespread fraud, which prompted the massive, unprecedented immigration enforcement operation
The Minnesota-based nonprofit had received $244 million from federal nutrition programs to feed low-income children and senior citizens between 2018 and 2021.
Feeding Our Future received an influx of federal funds during the Covid-19 pandemic when the US Department of Agriculture waived some regulations for nutrition programs.
Prosecutors found that the nonprofit had been using the funds for personal use, and over 63 individuals connected to Feeding Our Future were convicted on fraudulent charges, many of whom were of Somali descent.
After Walz was named as Kamala Harris’ running mate in 2024, Republicans accused him of allowing widespread fraud in the state.
Walz created a new centralized fraud investigation unit last January in response to the allegations; however, the state continued to be a magnet for fraud allegations from the Trump administration.
First Assistant US Attorney Joe Thompson announced in December that federal authorities estimated that fraud in Minnesota Medicaid programs may have cost taxpayers as much as $9 billion since 2018.
Shortly after the announcement, conservative YouTuber Nick Shirley shared a viral video accusing the daycare with a misspelled sign – the Quality Learning Center – of receiving public funds without providing a service.
Shirley’s video prompted a wave of allegations against other Somali-owned daycares in Minneapolis and caught the attention of federal agents.
The Quality Learning Center was featured in conservative YouTuber Nick Shirley’s viral video last December. The daycare was accused of fraud and came under fire for a misspelled sign, pictured above
The daycare center denied the allegations at the time, but closed in January pending a license review, according to the Minnesota Department of Human Services.
On Tuesday, federal agents seized records and other evidence connected with an investigation of publicly funded social programs for children.
Sources told Fox News that around 22 businesses were raided, including the Quality Learning Center.
