Name: Details on MN fraud scheme that redirected funds meant for children
Uploaded: 2025-12-12T00:17:41.050Z
Duration: 4 min 6 s
Description: In an exclusive report, CBS News obtained dozens of files and photos giving insight into the massive COVID-era fraud scheme in Minnesota. Among items purchased through fraud: Luxury cars and private villas.

In an exclusive report, CBS News obtained dozens of files and photos giving insight into the massive COVID-era fraud scheme in Minnesota. Among items purchased through fraud: Luxury cars and private villas.

Minnesota

A CBS News investigation has uncovered extensive details about a COVID-era fraud scheme in Minnesota, where federal taxpayer money intended for programs supporting children, the homeless, and those with behavioral issues was instead spent on luxury items such as cars, jewelry, and international travel. To date, 87 individuals have been charged and 61 convicted, with investigators describing the case as far from complete and continuing to expand.

Authorities have found no evidence that funds were directly sent to terrorist groups, despite public speculation. The investigation has also traced over $1 million in wire transfers to China, with the final destination of those funds still unclear due to limited cooperation from Chinese authorities.

Details on MN fraud scheme that redirected funds meant for children

Welcome back to The Takeout. In an exclusive report, CBS News obtained dozens of files and photos that provide some pretty sharp insight into the massive COVID-era fraud scheme in Minnesota. Among items purchased through this fraudulent effort, luxury cars, private villas, lots more. CBS Minnesota investigative reporter Jonah Kaplan joins me now from WCCO in Minnesota for more on his reporting. Jonah, take it away. Well, we're talking about our money. We're talking about taxpayer money that should have been used to feed hungry kids, that should have been used to help the homeless and people that needed housing assistance, that should have been used to support children with behavioral issues and autism. And here's what it was spent on instead. Luxury cars, trips to the Maldives, 21 karat gold necklaces bought at a shopping spree in Dubai and a beautiful two lot area right on one of the lakes here in the Twin Cities of Minnesota, of Minneapolis and St. Paul. And this is just one of the case files that we were able to obtain. So we're talking about a case that continues to grow. 87 people charged thus far, 61 convicted and counting. And investigators tell us we are not even at the end of the beginning of this investigation. And Jonah, how'd you get the case file? We asked for it. It's also about, of course, building relationships because this was a lot of exhibits that maybe were presented during the trial. These were cases that were first introduced in 2022, but in the way that it was described by investigators, it was kind of like an iceberg. You see a little bit of what's above, right, above the water, but then typically an iceberg is so much larger below the surface and what you can't see. And that's true, that frauds kind of give birth to other frauds. And this is something that not only has materialized, but metastasized. And this is something that we've been talking with investigators a lot, especially over the last few weeks and months, and especially since President Trump brought this back into the national spotlight. Again, these were first indictments were brought down in 2022, but we've had recent indictments even from a few weeks ago. So again, we continue to see more of this investigation and we continue to reveal more of what's been done with this federal taxpayer money. Jonah, as you know, as President Trump has talked about it, he's mentioned terrorism in Somalia and this fraud scheme. What do we know? Well, this is an important discussion and nuance because in the investigation so far, I've talked with several federal investigators and state investigators, there is no evidence of a direct payment between any one of these suspects charged, any one of these perpetrators. It's not like they wrote out a check to Al-Shabaab in Somalia or any other ISIS or Al-Qaeda affiliated group, no money directly given to a terrorist network. However, if let's say you're sending money to family who lives in Somalia or in Mogadishu, or in an area that maybe is controlled by an entity like Al-Shabaab, well, if they collect taxes, you send $10,000 and they collect a tax of $1,000, well, was that you supporting a terrorist organization? Not really, but that money still wound up in their hands. And so that's the kind of question that remains unanswered for investigators. And we also know from some of these new documents that we've obtained, there's more than a million dollars, at least in this one case file that were wired transferred to China. And that was not the final destination. But if you need that information from China, you're gonna have to ask Beijing for it. And they're not exactly willing to give up that information. Jonah, you keep digging. I know you will. And thank you for that reporting and valuable context. Really appreciate it. Great to be with you.

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