A new investigation published in City Journal alleges that massive fraud in Minnesota’s welfare and Medicaid systems didn’t just drain the state coffers — it also funneled millions in illicit remittances back to Somalia, where informally run hawala networks reportedly handed a cut to the terror group al-Shabaab. The piece, based on interviews with former federal investigators and other sources, charges that the scale of the theft is staggering and that taxpayer dollars meant for the vulnerable wound up funding militants abroad.
The City Journal report walks readers through the Housing Stabilization Services program, Feeding Our Future, and other schemes that prosecutors say were abused by sham providers and fake claims, producing indictments and guilty pleas this year. Federal prosecutors described some of the operations as “fictitious companies” created solely to bill Medicaid and other programs, and investigators say large sums were sent overseas in ways that evade standard financial oversight.
Minnesota Republicans didn’t wait for more headlines — state GOP lawmakers and key House Republicans have demanded a formal federal probe and written to U.S. authorities calling for urgent action, arguing that the allegations raise national-security as well as fiscal concerns. House Majority Whip Tom Emmer and other legislators have explicitly asked the new U.S. Attorney to open an inquiry after the City Journal piece revived and amplified these troubling claims.
Let’s be blunt: when state-run programs become slush funds that can be laundered through opaque transfer systems into the hands of violent extremists, that’s a failure of governance and a betrayal of every Minnesotan who works for a living. Governor Walz and Democratic lawmakers who have overseen these programs owe the public a full accounting, and political excuses about nuance and cultural sensitivity can’t replace audits, prosecutions, and reforms. The taxpayers who fund these programs deserve fierce stewardship, not perfunctory press statements.
Skeptics and defenders point out the City Journal article relies on anonymous sources and that no terrorism-financing indictments have yet tied Minnesota benefits directly to al-Shabaab in open court, a caution highlighted by critics who say the allegations need careful vetting. That pushback is worth noting — it’s not an invitation to shrink from the facts, but a reminder that oversight must be rigorous, evidence-based, and prosecutable in court.
Still, the right response is obvious and immediate: a thorough federal investigation, a state audit of every suspicious payment stream, tighter oversight of remittances, and penalties so severe they deter future theft. Law enforcement must follow the money where it leads, and elected officials at every level should stop protecting reputations and start protecting Americans and our national-security interests.
This scandal will be a defining issue in Minnesota politics next year because voters understand what’s at stake — honesty in government and safety for their families. Republicans should press relentlessly, demand transparency, and turn this into a campaign about competence and protection of taxpayers, not a platform for platitudes.
Americans should not tolerate a system where hard-earned tax dollars vanish into a web of fraud and end up enriching criminals or fueling terror. Honest compassion helps the needy; recklessness that allows fraud to metastasize is a moral and civic crime. It’s time for accountability, for courage, and for leaders who put the country first.
