Unearthed Surveillance Reveals Parents’ Role in Minnesota Daycare Fraud Scheme
MINNEAPOLIS, Minn. — A resurfaced surveillance video dating back to 2015 has shed new light on a sprawling fraud scheme involving parents and daycare providers in Minnesota, intensifying federal scrutiny of the state’s childcare subsidy system. The footage, originally recorded as part of a 2018 fraud prosecution in Hennepin County, shows parents signing their children into daycare centers only to leave with them minutes later, enabling providers to claim government reimbursements for services that were never rendered.
The video, obtained from a local Fox report, captures scenes in which daycare centers submitted claims for full-day care despite children’s brief or nonexistent attendance. In some instances, no families appeared at the centers on certain days, yet reimbursements were still sought from state funds. This scheme reportedly dates back to at least 2015 and has been linked to millions of dollars in fraudulent payments.
Federal authorities have ramped up their response amid growing outrage over the scandal. FBI Director Kash Patel confirmed that the bureau has deployed additional personnel and investigative resources to Minnesota to address the widespread abuse. The U.S. Attorney’s Office for the District of Minnesota has previously prosecuted related cases, including a 2022 action against 47 individuals tied to a $250 million fraud scheme misappropriating child nutrition funds, which prosecutors say were diverted to luxury goods, real estate, and kickbacks.
In the unearthed video, a man is seen handing an envelope to a parent, allegedly as a kickback payment for participation in the fraudulent scheme. This evidence aligns with prior findings that some participants received illicit payments to facilitate the abuse of government childcare subsidies.
The scandal has ignited political backlash, with Minnesota Governor Tim Walz facing intense criticism from both state lawmakers and national figures. Conservative voices, including Vice President JD Vance and Elon Musk, have publicly condemned the administration’s oversight failures. The White House echoed concerns, reposting a message from Education Secretary Linda McMahon describing the fraud as a “breathtaking failure.”
Calls for accountability have grown louder as the scandal unfolds. GOP lawmakers in Minnesota have demanded Governor Walz’s resignation, citing the extensive losses tied to social services fraud, particularly in Minneapolis. The controversy also highlights challenges in safeguarding public funds intended to support vulnerable families.
Federal agencies are coordinating efforts to investigate and dismantle the fraudulent networks. The FBI Minneapolis Field Office is actively involved in the inquiry, while the U.S. Attorney’s Office for the District of Minnesota continues to pursue criminal charges against those implicated. Additionally, the Administration for Children and Families under the Department of Health and Human Services is reviewing program integrity measures to prevent future abuse.
This scandal underscores the vulnerabilities in state-administered childcare subsidy programs and the need for rigorous oversight. As investigations proceed, authorities urge the public to report suspected fraud and emphasize their commitment to protecting taxpayer dollars.
For more information on federal efforts to combat fraud, visit the HHS Office of Inspector General website.
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