FBI and DHS Launch ‘Massive’ Fraud Probe in Minnesota Following Viral Video Allegations

The simmering tensions between the Trump administration and the state of Minnesota have erupted into a full-scale federal intervention.

On Monday, federal agents from the FBI and Department of Homeland Security (DHS) descended on Minneapolis, launching what officials call a “massive” investigation into alleged rampant fraud in state-run assistance programs.

The crackdown, triggered in part by a viral exposé from a conservative YouTuber, has turned the Twin Cities into the latest battleground of the culture war. It pits the full weight of the federal justice system against the state’s Democratic leadership—specifically Gov. Tim Walz and Rep. Ilhan Omar—accusing them of overseeing a “hotbed” of corruption that may have cost taxpayers billions.

At a Glance: The Minnesota Crackdown

• The Action: Federal agents are conducting door-to-door investigations at childcare centers and businesses in Minneapolis.
• The Catalyst: A viral video by YouTuber Nick Shirley, titled “I Investigated Minnesota’s Billion Dollar Fraud Scandal,” which alleges Somali-run daycares are billing millions for children who aren’t there.
• The Claim: Assistant U.S. Attorney Joe Thompson has suggested that up to $9 billion—half of the $18 billion in federal funds sent to Minnesota programs since 2018—may have been stolen.
• The Targets: The probe focuses on childcare assistance, housing stabilization, and autism services, with over 90 defendants charged so far.
• The Political Stakes: A direct confrontation between the Trump White House (represented by FBI Director Kash Patel and DHS Secretary Kristi Noem) and Gov. Walz, whom they accuse of negligence.

The Viral Spark: ‘Quality Learing Center’

While federal prosecutors say they have been investigating for months, the public fuse was lit last week by Nick Shirley, a conservative influencer.

His video alleged massive fraud in government-funded childcare programs, stirring outrage across the MAGA internet ecosystem. The video caught the immediate attention of Vice President JD Vance, who amplified the allegations.

FBI Director Kash Patel confirmed the bureau was already investigating prior to the video but acknowledged the viral moment brought new attention to the issue.

“FBI Director Kash Patel said in an X post that the FBI was already looking into fraud in Minnesota before Shirley’s viral video.”

The $9 Billion Accusation

The scale of the alleged theft is staggering.

Joe Thompson, the Assistant U.S. Attorney leading the prosecution, dropped a bombshell estimate earlier this month: he believes nearly $9 billion in federal funds may have been siphoned off through various Minnesota social safety nets since 2018.

This figure dwarfs the already massive “Feeding Our Future” scandal, the $250 million pandemic lunch fraud that resulted in convictions for ringleaders earlier this year. Prosecutors argue that the same “playbook”—using shell companies and fake rosters—has been replicated across autism services and housing programs.

However, Thompson did not offer concrete evidence for the $9 billion figure, and Gov. Walz has challenged these sweeping allegations.

The Somali Community in the Crosshairs

The investigation has taken on a sharp racial and political dimension. The Trump administration has explicitly linked the fraud to Minnesota’s Somali community, a demographic often targeted by the President’s rhetoric.

Of the 90+ defendants charged so far, the vast majority are Somali Americans. DHS Secretary Kristi Noem confirmed federal agents were on the ground Monday investigating “purported fraud,” framing the crackdown as a necessary restoration of order.

Democratic leaders, including Rep. Ilhan Omar (herself a Somali refugee), argue this focus is discriminatory and politically motivated, designed to demonize an entire immigrant community for the crimes of a few.

Walz Under Siege

For Governor Tim Walz, the crackdown is a political nightmare.

The administration portrays him as either incompetent or complicit. A legislative audit earlier this year faulted his administration for failing to rein in the “Feeding Our Future” fraud.

Walz’s office has pushed back, citing a lack of statutory authority to police these programs more aggressively and pointing to his own efforts to ask the state legislature for more power to crack down on bad actors.

“Walz’s office told Fox News that he ‘has worked for years to crack down on fraud and ask the state legislature for more authority to take aggressive action.’”

As federal agents continue to knock on doors in Minneapolis, the investigation threatens to unravel not just criminal networks, but the political standing of one of the Democratic Party’s key leaders.