Tuesday April 2, 2019
Somali community members and day care providers gather inside the State Capitol before meeting with an advisor to DFL Gov. Mark Dayton to protest allegations of fraud and funding terrorism inside the Minnesota State Capitol in St. Paul, Minn. on Monday, May 21, 2018. Evan Frost | MPR News
ST. PAUL, Minn. (AP) – Minnesota’s legislative auditor said Wednesday
that an investigation found no proof that money defrauded from a state
child care program found its way to terrorist organizations overseas.
Lawmakers asked Legislative Auditor James Nobles to look into the
issue after KMSP-TV reported last year that the Minnesota Child Care
Assistance Program was defrauded out of as much as $100 million per
year. The station, partly citing unnamed sources, also reported that
state and federal agents had determined that some of the ill-gotten
money had gone overseas and that they believed at least some of it
likely ended up with terrorists.
The station’s reports, which also cited , a former computer forensics
expert for the state Department of Human Services, which administers
the program, suggested that fraudulently obtained money had gone to the
Somali-based terrorist group al-Shabab.
In his report, Nobles said investigators couldn’t substantiate that
any of the money ended up with terrorists. He also said that while fraud
in the child care program is a problem, investigators couldn’t
establish a reliable estimate of how much money has been defrauded from
it, though they believe it’s more than the $5 million to $6 million that
prosecutors have been able to prove was stolen.
A separate review into whether the department’s oversight of the
program is adequate to safeguard its financial resources is due early
next month.
The Minneapolis area is home to the country’s largest Somali-American
community, and Nobles noted in his report that it’s common for
Somali-Americans to send money back to the East African country to help
family and friends. He said it’s possible that some money defrauded from
the program made its way overseas, but that there is no proof.
“It is possible that the individuals who sent the money sent it
intending to provide support to a terrorist organization,” the report
states. “It is also possible that individuals in Minnesota sent money to
Somalia and other countries to help their families and friends pay for
food, medicine, or shelter, but terrorists obtained the money through
theft or extortion. All of these are possibilities, but for none of them
did we find evidence to substantiate a connection between CCAP fraud
money and support for a terrorist organization.”
The Child Care Assistance Program provides federal money to help
low-income families afford child care while parents work or attend
school. Some daycare center operators allegedly overbilled for children
who weren’t really there. Prosecutors have charged at least a dozen
Minnesota residents, including several with Somali connections, and
child care centers with defrauding the program.
Republican leaders focused Wednesday on the need for stronger actions
to root out fraud. Sen. Mark Koran, who is vice chairman of the
Legislative Audit Commission, and several colleagues called for the
resignation of the Department of Human Services’ inspector general.
Nobles said his office interviewed department officials, program
investigators, law enforcement officials and prosecutors. His office
subpoenaed and interviewed him under oath. Investigators also reviewed
court records from about two dozen terrorism-related cases in Minnesota.
To obtain some information from prosecutors, investigators and law
enforcement, they agreed not to disclose certain details and to protect
identities of individuals who provided information, his report states.
“We are confident that given the history and expertise of
investigating and prosecuting terror-related cases in Minnesota, if
there were any allegations of CCAP fraud money going to terrorist
organizations, investigators would certainly follow up and prosecutors
would prosecute them for providing material support to terrorist
organizations,” the report states.
Human Services Commissioner Tony Lourey said his department is
committed to fixing the problem of fraud in the child care program, and
that it has asked the Legislature for money to beef up oversight
efforts.