Democratic Minnesota Gov. Tim Walz on Friday announced a new statewide fraud prevention program aimed at preventing another scandal like Feeding Our Future, which diverted $250 million in taxpayer funds intended for children in need.
Walz named Tim O’Malley, a former FBI agent and former director of the Minnesota Bureau of Criminal Apprehension, as the state’s new director of program integrity. O’Malley has also served as a chief judge on Minnesota’s Court of Administrative Hearings and worked with the Archdiocese of Saint Paul and Minneapolis in roles related to oversight and integrity. “He does not work for me, he works for the people of Minnesota,” Walz said. O’Malley emphasized his independence, stating, “I’m here to serve Minnesotans, not any individual or political party.”
The program was developed with support from WayPoint, a forensics company led by attorney and accountant Josiah Lamb, who described an “anti-fraud toolkit” including enterprise-wide policies and procedures to help prevent future fraud. The contract with WayPoint is valued at up to $200,000 and will cover all state agencies.
Feeding Our Future, the nation’s largest COVID-related fraud scheme, has renewed scrutiny amid federal investigations and criticism from Walz’s Republican challengers. Walz acknowledged the state’s role in the scandal, saying the pandemic loosened federal oversight and opened the door for fraud. He noted that he attempted to freeze funding for one related organization in 2021, but was overruled by the courts. “We have and have just like in COVID… I take full responsibility for it,” Walz said.
The scandal has involved more than 80 defendants, many of Somali descent, though the alleged mastermind of the scheme was White. So far, 61 people have been convicted, and investigations continue. Walz criticized recent federal actions targeting Minnesota’s Somali community as “racially motivated” and ineffective at addressing fraud.
Released evidence shows how fraudsters spent funds intended for children on luxury vacations, high-end vehicles, overseas money transfers, lakefront properties, first-class flights, and expensive jewelry. U.S. Attorney Daniel N. Rosen described the case as “massive” and said the overwhelming motive was personal enrichment.
Walz also announced audits of up to 14 social programs considered high-risk for fraud, with the state Department of Human Services currently reviewing more than 1,300 reported cases and recovering about $50 million.
The program is designed to provide stronger oversight across Minnesota’s agencies and help ensure taxpayer dollars are protected in the future.