- A video investigation reveals empty daycare centers received millions in state funds.
- The alleged fraud network may be part of a broader multi-billion dollar welfare scandal.
- A journalist's audit found over $110 million in questionable payments to Somali-owned businesses.
- FBI officials warn a dismantled $250 million scheme is just the tip of the iceberg.
- Governor Tim Walz faces intense scrutiny over oversight failures and the scandal's scale.
A shocking video investigation has peeled back the curtain on what appears to be a massive fraud network operating within Minnesota’s government-funded daycare system, raising urgent questions about oversight and the stewardship of billions in taxpayer dollars.
The report, released by journalist Nick Shirley, documents visits to multiple Somali-owned childcare facilities that stood eerily empty during operational hours, despite being licensed for dozens of children and receiving millions in state payments. This comes amid a federal investigation into a broader welfare fraud scandal that prosecutors estimate has ballooned to a staggering $9 billion, a crisis that has placed left-wing Governor Tim Walz under intense scrutiny.
Shirley’s 42-minute video, which has garnered more than 90 million views, functions as a citizen’s audit. He and a private investigator visited facilities like the “Quality Learing Center” in Minneapolis, noting the misspelled sign on a building licensed for 99 children. The center had received $4 million in taxpayer funds over two years. During the visit, the site was locked, no children or playground equipment were visible, and a woman inside yelled, “Don’t open up. It’s ICE,” when they approached.
A pattern of empty facilities
The investigation visited several other centers with similar red flags. The “Future Leaders Early Learning Center,” licensed for 90 children and recipient of $6.67 million, was also empty with evasive staff. “Mako Child Care and Mini Child Care Center,” combined licensed for 120 children, showed no signs of activity despite receiving more than $4.6 million in recent years. At “ABC Learning Center,” windows were blacked out. Shirley claims his initial review uncovered over $110 million in questionable payments to Somali-owned businesses in just one day of probing.
If accurate, these findings suggest a coordinated network of front companies designed to systematically extract money from programs like Minnesota’s Child Care Assistance Program (CCAP) with minimal actual service delivery. Corporate records show interconnected ownership between various daycare, adult care, and home healthcare companies, pointing to an organized effort rather than isolated failures.
The federal response and political fallout
The video ignited a political firestorm. Republican House Majority Whip Tom Emmer, who represents Minnesota, directly challenged Governor Walz on social media: “4 million dollars of hard-earned tax dollars going to an education center that can’t even spell learning correctly. Care to explain this one, Tim Walz?” FBI Director Kash Patel stated the bureau had already “dismantled a $250 million fraud scheme” related to federal food aid and had surged resources to Minnesota. He warned this was “just the tip of a very large iceberg” and noted some convicted individuals are being referred for possible denaturalization and deportation.
Governor Walz, who addressed the scandal in November, said such fraud “undermines trust in government” and vowed, “If you’re committing fraud… you are going to jail.” However, critics like Shirley accuse the governor of inaction, claiming he simply “wants votes.” The scale is monumental; federal prosecutors now believe the total fraud may exceed $1 billion just within the programs under investigation, with some reports alleging a portion of funds were funneled to the overseas terrorist group Al-Shabab.
This scandal transcends typical mismanagement. It represents a profound breach of public trust where programs meant to safeguard vulnerable children and families may have been weaponized for criminal profit. The historical context here is critical: massive, fraud-enabling government spending during the COVID-19 pandemic created fertile ground for such schemes. Now, Minnesota taxpayers are left wondering how a daycare that cannot spell “learning” could secure millions, and why empty buildings became vessels for a river of public cash. The real cost is measured not just in stolen dollars, but in eroded faith and the betrayal of every citizen who expects basic competence and honesty from their government.
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