Minnesota’s Federal Childcare Funding Frozen as Trump Administration Expands Fraud Probes

Trump administration freezes Minnesota childcare funds, orders Somali citizenship audits

MINNEAPOLIS — The Trump administration has frozen $185 million in federal childcare funding to Minnesota and ordered audits of immigration cases involving Somali Americans, escalating a fraud crackdown that state leaders and advocates say risks unfairly targeting a single immigrant community.

The Department of Health and Human Services announced the funding freeze Tuesday, citing viral allegations by conservative YouTuber Nick Shirley that Somali American–run daycare centers in Minneapolis siphoned as much as $100 million. Shirley’s video drew more than 100 million views on X and was amplified by Fox News coverage.

“We have turned off the money spigot and we are finding the fraud,” HHS Deputy Secretary Jim O’Neill said, adding the decision followed “serious allegations that the state of Minnesota has funnelled millions of taxpayer dollars to fraudulent daycare centres across the state over the past decade.”

Minnesota is home to the largest Somali population in the United States. The frozen funds support childcare services for low-income families across the state.

Gov. Tim Walz condemned the move as political. “This is Trump’s long game. We’ve spent years cracking down on fraudsters. It’s a serious issue – but this has been his plan all along,” Walz wrote on X. “He’s politicising the issue to defund programmes that help Minnesotans.”

In a parallel action, the Department of Homeland Security said it will audit immigration cases involving Somali Americans to identify potential fraud that could lead to denaturalization. “Under U.S. law, if an individual procures citizenship on a fraudulent basis, that is grounds for denaturalization,” DHS spokesperson Tricia McLaughlin said in a statement first reported by Fox News and later shared by the White House.

McLaughlin told Fox News that hundreds of investigators are also examining businesses in Minneapolis. “We believe that there is rampant fraud, whether it be daycare centres, healthcare centres, or other organisations,” she said.

Federal prosecutors allege that as much as $9 billion in Minnesota social assistance funding has been stolen since 2018, including $300 million allegedly misappropriated from a state children’s nutrition program during the COVID-19 pandemic. According to the administration, federal charges have been filed against 98 individuals, 85 of whom are described as being “of Somali descent.” The case became public in 2022 and has been increasingly highlighted this year by conservative politicians and activists.

FBI Director Kash Patel said the bureau is also investigating fraud allegations in the state. In a post on X, Patel said the FBI was “aware of recent social media reports” and had “surged personnel and investigative resources to Minnesota to dismantle large-scale fraud schemes exploiting federal programmes.”

Some U.S. outlets have questioned the credibility of Shirley’s claims, which underpin the administration’s justification for the funding freeze. The administration has not released an independent audit substantiating the $100 million figure attributed to Somali American–run daycare centers.

The actions arrive amid rising tension in Minneapolis, where demonstrators rallied last month against Immigration and Customs Enforcement amid reports of a federal operation targeting the Somali community. Advocates warn the audits and funding freeze could chill lawful participation in public programs and destabilize families who rely on subsidized childcare while investigations unfold.

HHS did not provide a timeline for when the frozen funds might be restored. DHS did not say how many immigration files will be reviewed or how long the audits will take.

By Ali Musa

Axadle Times international–Monitoring.