Federal Crackdown on Alleged Minnesota Child Care Fraud

This video captures a television interview with White House Press Secretary Karoline Leavitt discussing the Trump administration’s response to alleged widespread fraud in Minnesota’s child care and social service programs. The discussion centers on the federal government’s decision to pause $185 million in annual child care payments to Minnesota and the multi-agency investigation underway, while Governor Tim Walz defends his administration’s record.

According to the broadcast, Health and Human Services paused child care payments to Minnesota due to what Leavitt characterizes as a massive fraud investigation. The video shows Governor Walz responding to the federal action by claiming, according to the transcript, that “this is Trump’s long game” and accusing the administration of politicizing the issue to defund programs helping Minnesotans. Walz stated his administration spent years cracking down on alleged fraudsters.

Leavitt responds by calling Governor Walz “completely incompetent” and claiming President Trump has long criticized his leadership. She commends creator Nick Shirley for investigative journalism that allegedly brought further attention to the issue, noting that Shirley was invited to brief President Trump at what the transcript refers to as an “antifa roundtable.”

The Press Secretary outlines an extensive multi-agency federal response. According to Leavitt, the Department of Justice is executing search warrants and subpoenas, with arrests anticipated. She claims the Department of Homeland Security is conducting door-to-door investigations at alleged fraud sites and continuing deportations of individuals described as illegal aliens in Minnesota communities. Leavitt states the administration is prepared to use denaturalization as a tool.

Leavitt details additional agency involvement: the Department of Labor is allegedly investigating Minnesota’s unemployment insurance program, and the Department of Agriculture sent a letter to Governor Walz demanding names of all SNAP recipients in the state. She claims Minnesota’s Attorney General sued the Trump administration over this request, asking “what are they hiding?”

When asked about denaturalization, Leavitt confirms the administration supports revoking citizenship for those convicted of fraud. She references a claim that 98 people have been charged, with 85 allegedly of Somali descent according to Pam Bondi. Leavitt states the Department of Homeland Security and Department of State are examining denaturalization options.

According to Leavitt, some buildings that Nick Shirley allegedly exposed in his video are under current Justice Department investigation. She claims one site, the Midway building, resulted in 13 defendants being charged earlier in the year. When asked whether other states face similar scrutiny, Leavitt indicates Minnesota is currently the top priority but suggests California and New York may face investigation.

The interview positions this alleged fraud investigation as part of a broader administration effort to eliminate waste and fraud from federal programs. Leavitt frames the issue as protecting “law-abiding taxpaying citizens” who have allegedly been “ripped off” by individuals who abused immigration and social service systems. The federal response, if the claims are substantiated, represents a significant escalation in oversight of state-administered federal benefit programs and raises questions about the balance between fraud prevention and program access for eligible families.

In Karoline Leavitt’s Own Words

“People will be in handcuffs as a result of the fraud that Governor Walz has allowed to occur for many years.”

“We are cutting off all child care funding to the state of Minnesota until we get to the bottom of the fraud.”

“This is a whole of government effort. We have surged resources. The Department of Justice has charged and prosecuted nearly 100 people.”