The New York Post learned that Minnesota’s child care agency never verified attendance records at the centers or followed up on any fraud tips.
Anyone shocked?
The outlet obtained a letter that the Department of Health and Human Services’ Administration for Children and Families sent to Minnesota:
HHS’ Administration for Children and Families informed Minnesota officials that its handling of the distribution of federal taxpayer dollars for child care in the state had “not established adequate controls to verify the accuracy of county-issued provider payments based on attendance of children.”As a result, child care centers could get funding from counties — and counties could then bill the state and the federal government by extension — “without reconciling billed hours against attendance records, even periodically.”Minnesota’s Department of Children, Youth and Families also had “[l]imited staff and resources … to adequately pursue fraud tips and conduct proactive investigations,” Laurie Todd-Smith, HHS ACF deputy assistant secretary for early childhood development, wrote in the letter.
Minnesota assigned only four investigators to address fraud tips.
“Minnesota did not demonstrate that they are currently implementing required program integrity training for providers across the state,” wrote Todd-Smith.
The latest oversight visit revealed that HHS found Minnesota did not have a “mandatory, statewide process to obtain, review and act on county level single audits.”
The Trump administration already paused child care funding in Minnesota due to the many fraud allegations.
Minnesota’s former top prosecutor believes the fraud cost the state as much as $9 billion since 2018.
The Department of Children received $184,928,081 from HHS in 2025.
HHS Assistant Secretary Alex Adams said Minnesota should spend that money on more than 19,000 children and infants.
Adams said that the director of the Minnesota Child Care Services could not tell him “with confidence whether those allegations of fraud are isolated or whether there’s fraud stretching statewide.”
In January, HHS warned Minnesota that it could have to repay funds to the Department of Children if officials did not provide attendance and inspection reports within 60 days.
CLICK HERE FOR FULL VERSION OF THIS STORY