Gov. Walz: ‘No evidence’ of fraud in billions despite allegations
Gov. Walz responds to $9 billion fraud accusations
Gov. Walz responded on Friday to speculation from federal prosecutors that fraud throughout Minnesota’s service programs could total more than $9 billion. FOX 9’s Rob Olson has the latest.
ST. PAUL, Minn. (FOX 9) - Minnesota Governor Tim Walz is under ever-increasing criticism for how his administration has handled rampant fraud in state-administered federal programs.
Walz on Friday said whether it’s his administration’s fault or not he takes responsibility for ending it, but that speculation that the fraud runs into the billions of dollars is unfounded.
Industrial scale fraud
What we know:
The estimated fraud from the Feeding our Future scandal is around $250 million.
On Thursday, federal prosecutors announced a new round of charges related to Medicaid fraud in autism and housing programs. Eight others were previously charged in housing-related fraud schemes in September.
But Assistant U.S. Attorney Joe Thompson said he believed these were just the tip of the iceberg, suggesting a "significant amount" of the $18 billion paid by Medicaid programs since 2018 were fraudulent, perhaps half or more.
‘No evidence’
What they're saying:
On Friday, Gov. Walz and officials from the Department of Human Services (DHS) said there’s no evidence to suggest a number anywhere near that much.
"We’ve seen evidence of tens of millions of dollars to this point," said Deputy DHS Commissioner John Connelly. "We don’t have evidence in hand to suggest we have $9 billion in fraud in these benefits over the last seven years and if there is evidence, we need it so we can stop payment."
The department’s Inspector General, James Clark, said he’s asked the U.S. Attorney’s office to share information and hopes to meet with them soon.
"I have a very unique role in state government," said Clark. "I work at the Department of Human Services. I can shut off money to people and businesses where there is evidence of fraud… What I’m saying is I haven’t seen any evidence or information to suggest there is $9 billion worth of Medicaid fraud that’s happened in the state of Minnesota."
Politically charged
What's next:
Gov. Walz recently appointed former BCA Superintendent Tim O’Malley to head the state’s fraud prevention efforts, to identify oversight problems in state programs that criminals have taken advantage of.
Meantime, the House GOP has commenced a fraud committee to investigate further claims of fraud and explore just how deep the problem goes.
The issue is a huge liability for Walz, running for a third term, as opponents accuse him of doing too little to stop fraud and his administration of retaliating against whistleblowers.
Walz agrees the issue is serious and requires significant attention, but accuses opponents of amplifying it for political gain.