WASHINGTON D.C. January 9, 2026 – Treasury Secretary Scott Bessent announced new federal measures to investigate and combat what he described as rampant welfare fraud in Minnesota, claiming billions of dollars in taxpayer funds intended for vulnerable populations were diverted under the administration of Democratic Governor Tim Walz.
In a video statement posted to X on January 9, Bessent, speaking from a podium flanked by the U.S. and Department of the Treasury flags, said President Donald Trump had directed the administration to “restore accountability” for Minnesota residents.
“President Trump is committed to restoring accountability to put Minnesota back on the right track,” Bessent stated. “Under President Trump’s leadership, the entire administration is focused on delivering results for the American people. Our citizens have a right to know that their tax dollars are not being diverted to fund acts of global terror, or to fund luxury cars for fraudsters.”
Bessent alleged that billions of dollars meant for feeding hungry children, housing disabled seniors, and providing services for children with special needs were instead diverted “to people who cheated the system, some of whom are not even American citizens.” He specifically highlighted investigations into funds sent to Somalia through money service businesses operating outside formal banking systems.
The announcement builds on the long-running Feeding Our Future scandal, a federal investigation into alleged fraud in Minnesota’s pandemic-era child nutrition programs. The case, which emerged in 2022, has resulted in dozens of convictions and charges related to approximately $250 million in misappropriated funds, primarily involving defendants from Minnesota’s Somali community. Recent court actions include a federal judge ordering the forfeiture of $5.2 million in assets from one convicted ringleader.
Treasury Department press releases confirm Bessent’s initiatives include enhanced oversight of money service businesses, new investigative tools for federal agencies, and coordination with state authorities. Bessent described Minnesota as “ground zero for what may be the most egregious welfare scam in our nation’s history” and indicated similar probes could expand to other states.
Critics, including some Democratic lawmakers, have called the rhetoric politically motivated, noting the fraud occurred under federal programs administered during the COVID-19 emergency. Governor Walz’s office has not yet issued a formal response to the latest announcements.
The Treasury Department emphasized that investigations are ongoing and no final determinations have been made regarding the full scope or beneficiaries of the alleged fraud.
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