FBI Searches Businesses Around Minneapolis as Part of Fraud Inquiry

ST. PAUL, Minn. — Federal agents on Tuesday morning searched businesses in the Minneapolis area, including daycare centers, as part of a fraud investigation, the Department of Homeland Security said.

The operation was among the boldest moves since the White House launched a task force to combat fraud in social services programs last month, which Vice President JD Vance was appointed to lead.

A law enforcement official, who spoke on condition of anonymity to discuss a continuing investigation, said agents from the FBI and the Department of Homeland Security had obtained 22 search warrants. The official added that the operation was unrelated to immigration enforcement.

“The task force and the DOJ will be relentless in exposing these fraudsters wherever they may be hiding,” Vance said on social media, referring to the Department of Justice.

Fraud in safety net programs in Minnesota has roiled the state in recent years, and captured the attention of the Trump administration. Federal prosecutors have charged scores of people with defrauding programs that were designed to feed low-income children, treat minors with autism and help people avoid homelessness.

Billions in taxpayer money have been stolen, according to federal prosecutors, with the first arrests occurring in 2022.

Citing the Minnesota scandal as an example, the Trump administration has claimed that widespread fraud has occurred in other Democratic-led states, saying they have been poor stewards of taxpayer dollars and threatening to withhold billions from safety net programs. State officials have called the move retribution and said that the cuts will harm thousands of vulnerable adults and children.

Although the fraud in Minnesota has been under scrutiny for years, the Twin Cities have been contending with aggressive federal actions since Trump beat Kamala Harris and her running mate, Minnesota Gov. Tim Walz. Last year, roughly 3,000 federal agents were sent to the area to root out immigrants in the country illegally, a surge that was met with fierce resistance by protesters and led to the killing of two residents.

In early January, Walz announced that he was not running for reelection so he could devote more attention to combating fraud. He is scheduled to give his final state of the state address at the Capitol on Tuesday night.

The vast majority of the individuals charged in the state’s safety net fraud cases in recent years are of Somali origin. The White House cited that fact in justifying an immigration crackdown in the state this winter, even though the vast majority of defendants were American citizens.

Officials did not immediately disclose the nature of the businesses that were being searched or provide additional details.

Some locations federal agents searched Tuesday included daycare centers. Those businesses — some of which receive government funding — drew nationwide attention after Nick Shirley, a right-wing content creator, published a viral video in late December purporting to have exposed widespread fraud.

One business featured in that video — Quality Learning Center — became the subject of mockery because it had a sign that misspelled the word Learning. The site where the business operated was among those federal agents searched Tuesday, but it was not clear whether it remains operational.

Among the other locations federal agents were searching Tuesday morning was a tan building in south Minneapolis that houses two businesses: the Somali Senior Center and Adult Day Services, and the Original Child Care Center.

A local news station, KSTP, reported that federal agents had used a battering ram to enter another daycare center in south Minneapolis.

Federal prosecutors have described the scale of fraud in Minnesota’s safety net programs as staggering. They say business owners have stolen several billion dollars in recent years by submitting claims for services that were not rendered.

The scandal has bedeviled Walz and other Democratic elected officials in the state as Republicans have questioned how so much taxpayer money was stolen on their watch. His administration has acknowledged that several programs lacked strong safeguards, making them magnets for thieves, and has tightened oversight.

State investigators were involved in the inquiries that led to the searches Tuesday, according to the governor’s office.

“If you commit fraud in Minnesota you’re going to get caught — and that’s exactly what we saw today,” Walz said in a statement. “We catch criminals when state and federal agencies share information.”

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This article originally appeared in The New York Times.

By Ernesto Londoño and Billy Witz/Jamie Kelter Davi
c. 2026 The New York Times Company

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