Minnesota Gov. Tim Walz is facing new scrutiny in a $250 million COVID-19 fraud scandal in his state, which critics say is his responsibility as governor, especially after he was named as Kamala Harris’ running mate for the 2024 Democratic nomination.
Seventy people have been indicted in connection with a fraud scheme that resulted in the loss of $250 million from the Minnesota Department of Education’s (MDE) Feeding Our Future program, a federally funded food assistance program designed to provide free meals to eligible children and adults, between 2022 and 2024.
“At least $250 million was stolen by fraudsters,” Billy Grahn, an adjunct policy fellow at the Minnesota-based Center for the American Experiment, told Fox News Digital about the scandal.
“Naturally, the question arose: How did the state Department of Education funnel $250 million to people who were later convicted of misusing the program? The Legislative Auditor General took on this as a project and produced a report looking at how the Department of Education oversaw one of the nonprofits involved.”
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Democratic vice presidential nominee and Minnesota Governor Tim Walz speaks during a campaign event in Detroit, Michigan, on August 7, 2024. (Andrew Harnick)
Grahn pointed to a report from the Minnesota Office of Legislative Audit (OLA), which frequently releases oversight reports on state government.
The report into the fraud scheme in question, “Minnesota Department of Education: Monitoring Feeding the Future,” was released in June. In it, State Legislative Auditor Judy Randall concluded that MDE officials told OLA they quickly identified and stopped the fraud, but that she believed OLA could have done more to prevent the theft of $250 million in funds.
“MDE officials told us the department only began to have concerns about Feeding Our Future after the COVID-19 pandemic began. However, we believe MDE failed to act on warning signs that the department was aware of before the COVID-19 pandemic began and before the alleged fraud began,” the report states.
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The article continues: “More broadly, the failures highlighted in this report are a symptom of a department that was ill-prepared to deal with the problems it encountered with Feeding Our Future.”
Kamala Harris was selected as the 60-year-old Midwestern governor over other candidates, ending weeks of speculation about who would be her running mate. (Andrew Harnick/Getty Images)
Critics point to the failure as governor and Walz’s leadership. “The blame has to come from somewhere,” Glahn said.
“He is the state’s chief executive. All of the officials in the Department of Education and other departments where the fraud took place were appointed by him,” Grahn pointed out. “So he’s the one who appoints the commissioners, the deputy commissioners, the assistant commissioners. They were all appointed by him. They all report to him. And these are the people who the Legislative Auditor General has recorded as negligent in their duties. So how far does the responsibility extend?”
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Glahn said Minnesotans may be surprised to find the state doesn’t run as smoothly as it once did, and said his response to the scandal is “much more cynical.”
Minnesota Governor Tim Walz speaks during a Biden-Harris campaign and Democratic National Committee press conference on July 17, 2024 in Milwaukee, Wisconsin. (Jim Vondruska/Getty Images)
“It turns out that a lot of the people who were indicted, and their spouses or close relatives or business partners, donated huge amounts of money to the Democratic Party,” Grahn noted, “so they’re campaign donors. And when these nonprofits had issues with the Department of Education, the Department of Education either withdrew funding a couple of times and failed, or they didn’t have the courage or the conviction to do it, so the politicians fought for the nonprofits.”
Grahn added that the system highlights the idea that “the government’s objective is to distribute benefits and funds, not to police or monitor or regulate or make sure people qualify for these benefit programs.”
The suspected fraudsters spent the money on everything from homes, cars, luxury items, jewelry, cryptocurrency, hotels, restaurants and airline tickets.
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Governor Walz’s office did not immediately respond to a request for comment from Fox News Digital, but in a statement to local news outlet the Star Tribune, a spokesperson for the governor said, “We appreciate the work of OLA and often agree with their recommendations, which is why state agencies have implemented many of their recommendations.”
The spokesperson added that “in some cases OLA’s recommendations may not apply because audit results are released years after issues have been resolved, recommend actions that have already been implemented or evaluate programs that no longer exist.”
“State agencies may have expertise or knowledge that OLA does not have, and in those cases we may have fundamental differences of opinion,” the spokesperson continued, according to the Star Tribune.
Joe Tailove, Republican candidate for Minnesota’s 2nd Congressional District, said in a post on X that fraud on Walz’s watch exceeded $500 million.
“Imagine this kind of fraud happening on a national scale.”
“Governor Walz and those he directly employed and oversaw lost $500 million to fraud in just his first few years as governor. Imagine a fraud of that magnitude across the nation,” Tailove said. “If every state lost that much, the total losses to fraud would exceed the annual budgets of over 15 states.”
In a follow-up post to ABC’s reporting on the fraud scandal, Taylove said “this is not just about Feeding Our Future.”
“His administration has lost over $500 million so far and there has been rampant waste and fraud in child care programs, bonus programs for frontline workers, unemployment benefits, Medicaid programs and more,” he explained. “The issue isn’t that his administration allowed fraudsters to get away with over $250 million meant to feed hungry children. The issue is that no alarm bells were raised and there has still been no accountability. Not a single state employee has been fired over this.”
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Critics of Governor Walz’s handling of taxpayer funds point out that an $18 billion surplus in his $72 billion budget was originally supposed to be returned to taxpayers but was instead used for other state initiatives.
“Providing tax relief for young families would sound great if Minnesota wasn’t such an expensive place to live, and I’d be grateful for that,” House Minority Leader Lisa DeMuth said in March. “On top of the $18 billion surplus that’s now gone, we’ve added another $10 billion in taxes and fees, the state budget. We’ve expanded government in an unsustainable way.”
