Fraud in Minnesota: Stop the Bleeding, Fix the System

Fraud is not new. It didn’t arrive with the internet, modern government programs, or a particular community. Fraud has existed for as long as human beings have been capable of deception. Wherever there is money, power, or opportunity, there will always be people willing to take advantage of weak systems. That reality is uncomfortable, but it is also universal.

Minnesota is no exception. In recent years, the state has seen a steady stream of fraud cases tied to public programs—childcare, housing, healthcare, and food assistance. The response, however, has too often focused on who committed the fraud rather than how the fraud was made possible. When headlines repeatedly single out Somali-run daycare centers or imply cultural blame, we move in a dangerous and unproductive direction.

We typically do not blame an entire race, ethnicity, or immigrant group when a small percentage of individuals commit crimes. We do not do it with white-collar fraud on Wall Street. We do not do it with corporate tax evasion. And we should not do it here. Theft is theft—no matter who commits it. Those who steal public money are thieves and should be held accountable. Full stop.

But stopping there misses the bigger problem.

Fraud flourishes when systems are poorly designed. When oversight is weak, verification is minimal, and accountability is rare, dishonest people will exploit the gaps. Honest people don’t need complicated systems to remain honest. Dishonest people will always look for the easiest path to steal. That’s why the real question Minnesota must confront is not “Who committed fraud?” but “Why was it so easy to commit?”

This is analogous to safety in the workplace. I have 40 years of manufacturing experience and employee safety wasn’t prioritized when it was convenient, it was the foundation that everything else rested on. We had formal reviews to determine how someone could be hurt with our equipment and then engineer that out. The same holds true here.

If we want to stop the bleeding—and prevent future abuse—we need to fix the root causes. That means designing systems that assume bad actors will exist and make fraud difficult, risky, and costly.

Here are five practical ways Minnesota can build stronger, fairer systems that protect taxpayers and legitimate providers alike:

1. Stronger Front-End Verification

Many programs rely too heavily on self-reporting. Income, enrollment numbers, attendance, and expenses should be verified before large sums are paid out. Requiring documentation up front may slow the process slightly, but it prevents massive losses later. How many times do we have to learn this lesson before change is made?

2. Random Audits as a Deterrent

Audits should not only occur after whistleblowers or media exposure. Random, unannounced audits create uncertainty for would-be fraudsters. When people know they might be checked at any time, behavior changes. Many of the most recent fraud cases were right here in the Twin Cities. Make that a job requirement of everyone working in that department, i.e. I will complete 10 audits on site per year as part of my performance expectations. Standardize the audit so everyone is completing and documenting it the same.

3. Clear Caps and Phased Payments

Instead of large lump-sum reimbursements, payments should be capped and released in phases. Sudden spikes in billing or enrollment should trigger automatic reviews before more money flows out the door. Given today’s algorithms and AI, how hard is it for technology to flag these outliers?

4. Better Data Sharing Between Agencies

Fraud often slips through because agencies operate in silos. Cross-checking data—such as enrollment numbers, licensing records, and tax filings—can quickly reveal inconsistencies that signal abuse. If our computers cannot “talk” to each other, invest money there so we have a secure, stable communication path.

5. Equal Oversight for Everyone

Oversight must be universal and race-neutral. When rules apply evenly to all providers, enforcement becomes fair, defensible, and effective. This protects honest operators—many of whom are immigrants—from being tarnished by association.

Fraud will never disappear entirely. Human nature guarantees that some people will always test the boundaries. But a well-designed system doesn’t rely on trust alone—it relies on verification, accountability, and smart safeguards.

If Minnesota truly wants to solve its fraud problem, we must stop sensationalizing the thieves and start fixing the systems that made theft so easy in the first place. Fix the process, raise the barriers, and the headlines will change on their own.