House Democrats spent years selling Gov. Tim Walz (D-MN) as the competent, sensible Midwesterner the party needed. A bombshell House Oversight Committee report released Monday tells a different story.
The report, titled "The Cost of Doing Nothing: How Tim Walz and Keith Ellison Fueled Minnesota's Fraud Explosion," concludes that Walz and Minnesota Attorney General Keith Ellison were aware of credible, systemic fraud in federally funded social programs as early as 2019 and did nothing. Their reasons for inaction weren't legal barriers. They were fear of lawsuits, fear of being called racist, and fear of upsetting the politically active Somali community in Minneapolis, a constituency both men depend on politically. The cost was an estimated $300 million in federal child nutrition funds lost, and potentially $9 billion in Medicaid-related spending lost or placed at serious risk.
House Oversight Chairman James Comer (R-KY) slammed the governor upon the report's release:
"Billions of dollars were stolen because Minnesota state leaders turned a blind eye to rampant fraud and retaliated against state employees who dared to raise concerns. The Walz Administration chose to protect the system rather than protect the taxpayer."
Walz officials claimed their hands were tied, blaming courts, federal agencies, and law enforcement for their inaction. When Minnesota Department of Education (MDE) officials grew suspicious of Feeding Our Future's (FOF) exploding reimbursement claims, including a single restaurant claiming to serve as many meals as the entire St. Paul Public School District, FOF threatened a discrimination lawsuit. Within 24 hours, the Walz administration reversed course and approved not just the denied sites, but ten additional ones. One MDE official told the FBI that she had been specifically warned not to scrutinize Somali-run providers. As she put it, she was "warned not to do anything that would be considered targeting or discriminating against certain diverse communities." MDE's own assistant commissioner testified that the agency could have pulled funding unilaterally at any point. They chose not to.
Walz later claimed a court had ordered his administration to keep paying FOF. The judge took the extraordinary step of publicly rebutting that claim:
"Governor Tim Walz told the media that the Minnesota Department of Education attempted to end payments to FOF because of possible fraud, but that Judge Guthmann ordered payments to continue in April 2021. That is false."
At the March 2026 congressional hearing, Walz still wouldn't concede the point.
The fraud extended far beyond meal programs. Autism treatment billing under one Medicaid program exploded from $671,000 in 2018 to $342 million in 2024, a roughly 500-fold increase. At the hearing, Walz acknowledged that it didn't "sound reasonable.” Federal prosecutors allege fraudsters were recruiting Somali families, paying monthly kickbacks to parents, and obtaining fraudulent autism diagnoses to maximize Medicaid billing.
The administration eventually terminated an entire housing stabilization program because DHS admitted it lacked "the necessary controls to stop bad actors.” It then announced it was hiring 160 new staff to do the oversight it had long claimed it couldn't afford.
Big: FBI Indicts 15 in $90M Minnesota Medicaid Fraud Scheme
The committee also documented systematic retaliation against employees who raised concerns. Nearly 30 whistleblowers, most of them current Walz administration staff, described being ignored, surveilled, and threatened. The Walz administration shut down the criminal investigations unit probing child care fraud entirely. Investigators were told that DHS was no longer conducting criminal investigations into child care. Without that enforcement mechanism, there was nothing left to deter further schemes.
His former Chief of Staff, Chris Schmitter, when asked about any of it in a transcribed interview, said he did not know, could not remember, or could not recall approximately 260 times. The committee concluded he was protecting Walz.
Walz has given three different public answers about when he first learned of the fraud, issued corrections to his own corrections, and told the committee in March he simply couldn't remember. When investigators requested documents from both his office and Ellison's, Walz produced 48 documents, many of them public press releases. Ellison produced 11.
Walz announced in January 2026 that he would not seek a third term. At the hearing, he explained why: "I am not going to run again. I need to spend the time fixing this."
The fraud was known, the authority to stop it existed, and the decision was repeatedly made not to use it. The Trump administration has since withheld $259 million in Medicaid funds from Minnesota, executed 22 search warrants, and secured 15 new indictments. The investigation is ongoing.
Editor’s Note: Help us continue to report the truth about corrupt politicians.
Join RedState VIP and use promo code FIGHT to receive 60% off your membership.
Join the conversation as a VIP Member