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Federal payment freeze follows viral video claims
The Trump administration suspended $185 million in annual child-care subsidies to Minnesota on Tuesday after a conservative YouTuber accused Somali-run centres of misusing public funds.
HHS cites 'blatant fraud' in Minnesota
Department of Health and Human Services Deputy Secretary Jim O'Neill announced the freeze on X, linking it to "serious allegations that the state has funneled millions of taxpayer dollars to fraudulent daycares over the past decade."
The department will withhold the $185 million until a full review of the centres is completed.
O'Neill also unveiled a "defend the spend" system that will require states to submit receipts or photo evidence before receiving future payments.
Video sparks state and federal probes
A weekend video by Nick Shirley, which has garnered millions of views, showed nearly a dozen centres allegedly operating without children present. Shirley claimed the facilities were collecting public funds without providing services.
Minnesota officials responded by re-inspecting the sites this week. Two had already closed, while the remaining centres held active licenses and had passed recent state inspections.
The most recent check occurred on 4 December at Sweet Angel Daycare, a centre that drew particular scrutiny online.
State defends oversight, FBI weighs in
Commissioner Tikki Brown of the Minnesota Department of Children, Youth, and Families acknowledged concerns raised by the video but noted that the methods used were questionable. She emphasized that the state takes fraud allegations seriously and conducts regular inspections.
FBI Director Kash Patel stated on X that investigations into Minnesota fraud have been ongoing since the pandemic. He described the current allegations as "just the tip of a very large iceberg."
"We will continue to follow the money and protect children, and this investigation very much remains ongoing."
FBI Director Kash Patel
Political tensions escalate
The freeze follows months of heightened immigration enforcement in Minnesota, home to the largest Somali immigrant population in the U.S. Earlier this month, President Donald Trump told reporters he did not want Somali immigrants in the country, urging them to "go back to where they came from."
Minnesota Governor Tim Walz, the Democratic vice-presidential nominee in 2024, criticized the move as a "PR stunt" that unfairly targets immigrants. He stated that while the state welcomes efforts to investigate crime, indiscriminate actions are not a viable solution.
The controversy arrives amid broader federal scrutiny of pandemic aid fraud. In March, a federal jury convicted the leader of Feeding our Future, a now-defunct Minnesota organization, for orchestrating the largest pandemic-relief fraud to date, involving $250 million.
