WASHINGTON, D.C. December 31, 2025 – The Trump administration has taken swift action to halt federal child care payments to Minnesota following a viral video that purportedly exposes widespread fraud in the state’s daycare system. The move comes after independent journalist Nick Shirley’s undercover footage sparked national outrage, prompting federal probes and drawing scrutiny from media outlets including CNN.
Shirley, known for his on-the-ground investigative videos, released a series of clips in December 2025 showing what he claims are empty or non-operational daycares in Minneapolis receiving millions in government funds through programs like the Child Care Assistance Program (CCAP). In one prominent example, Shirley highlighted a facility misspelled as “Quality Learing Center,” which he alleged received $1.9 million in tax-exempt funding in 2025 despite appearing abandoned. Shirley confronted Minnesota lawmakers and daycare operators, accusing them of enabling billions in fraud that diverts resources from legitimate needs, such as families and disabled children.
The video quickly went viral on platforms like X (formerly Twitter), amassing millions of views and shares. Posts from users amplified Shirley’s claims, with one stating, “This is unreal—Nick Shirley absolutely destroys the excuses from Minnesota lawmakers on the massive Medicaid fraud scandal.” Supporters praised the exposure, while critics accused Shirley of misrepresentation and targeting the Somali-American community, which operates many of the facilities in question.
In response, the Department of Health and Human Services (HHS) under the Trump administration announced on December 30, 2025, that it was freezing all federal child care payments to Minnesota pending a full investigation. HHS Secretary Robert F. Kennedy Jr. stated, “We have turned off the money spigot and we are finding the fraud,” emphasizing the administration’s zero-tolerance policy. Federal agents were dispatched to the state to probe allegations that echo a long-running scandal, where prosecutors have already indicted over 80 individuals in related cases dating back years. The fraud reportedly involves exploiting state-run programs funded by federal dollars, including COVID-19 relief, with estimates of losses reaching hundreds of millions.
CNN, in a breaking news segment aired on December 31, 2025, attempted to verify Shirley’s claims by reaching out to several featured daycares. Correspondent Whitney Wild reported that only one facility responded, affirming it was a legitimate business. The network questioned Shirley’s methodology during an on-camera interview, asking, “How do you know that all the allegations that you’re making are true?” Shirley defended his work, replying, “We showed you guys what’s happening and then you guys can go ahead and make your own analysis.” CNN’s report highlighted pushback from some daycares, with one manager calling the allegations “really dishonest” and “completely false,” arguing the footage was taken outside operating hours.
Minnesota officials and Republicans in the state legislature have long raised alarms about the issue, but the viral video accelerated federal involvement. Governor Tim Walz’s office responded by stating the state takes fraud seriously and is working to improve oversight, noting, “Let’s make sure that our children have safe places to learn and grow.” However, critics on X mocked CNN’s investigation as superficial, with one post quipping, “CNN: ‘Hey, are you legit?’ Somali business: ‘Uh, yeah?’ CNN: ‘Case closed.'”
The scandal has reignited debates over immigration, welfare programs, and government accountability. Shirley, who has over a million followers on X, promised more exposures, stating, “In one afternoon me and my crew exposed over $20,000,000 in fraud.” Fact-checks from outlets like MSNBC have questioned some of Shirley’s assertions, noting instances where children were present at facilities he claimed were empty.
As investigations continue, the freeze on funds could impact thousands of low-income families reliant on child care subsidies. The Trump administration has signaled this is part of a broader crackdown on fraud nationwide, with similar reviews underway in other states.
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