The Trump administration on Tuesday notified five blue states — including Minnesota — that it was freezing $10 billion in child care funds pending a "thorough review" amid concerns of "systemic fraud," Axios reported.
Beyond Minnesota — where fraud has sparked concerns over a broader pattern of abuse — the Administration for Children and Families, a division of the Department of Health and Human Services, sent letters to New York, California, Illinois, and Colorado, suspending billions in funding across three programs:
— TANF, or Temporary Assistance for Needy Families.
— CCDF, or the Child Care Development Fund.
— SSBG, or Social Services Block Grants.
The letters require the states to submit extensive data on all recipients of federal funds, including names, Social Security numbers, and birth dates, along with other detailed records going back years, the report said.
"These concerns have been heightened by recent federal prosecutions and additional allegations that substantial portions of federal resources were fraudulently diverted away from the American families they were intended to assist," reads the letter to Illinois, according to Axios.
"Additionally, ACF has reason to believe that the State of Illinois is illicitly providing illegal aliens with CCDF benefits intended for American citizens and lawful permanent residents."
Independent journalist Nick Shirley last month posted a viral video showing Minneapolis-area day care operations that were beneficiaries of hundreds of millions of dollars in taxpayer funds despite no legitimate business to justify the influx of money.
Newsmax correspondent Joe Moeller reported that at least one Minnesota day care center appeared to be operating despite having its license revoked more than five years ago. Another day care, Intisar, lost its license in 2021 due to violations, according to records.
The funding freeze will delay payments to child care providers, potentially forcing closures and disrupting services across the five states, the report said.
"We have a duty to the American people to ensure their hard-earned taxpayer dollars are being used for legitimate purposes," HHS spokesman Andrew Nixon told Axios.
Funding will remain suspended until the review is completed, with some programs facing a Jan. 20 compliance deadline, Axios reported.
Mark Swanson ✉
Mark Swanson, a Newsmax writer and editor, has nearly three decades of experience covering news, culture and politics.
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