A former investigator with Minnesota's Department of Human Services told state lawmakers this week that agency officials attempted to suppress evidence of fraud in a taxpayer-funded childcare program, as a sweeping federal investigation into alleged abuse of public funds intensifies.
Jay Swanson, who previously conducted criminal investigations into childcare providers, testified Tuesday before a Minnesota House Oversight Committee that his superiors pressured him to alter or withhold findings tied to fraudulent billing practices.
Swanson said the directives came after he responded to a legislative inquiry into suspected fraud within the state's Child Care Assistance Program.
"I then advised this official that I believed what they were telling me to do was illegal," Swanson said in testimony.
Swanson also alleged he was instructed to delete investigative findings, describing the request as unlawful and part of a broader effort to limit scrutiny of potential fraud cases.
He further testified that "members of our unit were harassed and bullied by DHS officials" as they pursued investigations into suspected wrongdoing.
The testimony comes as federal authorities, including the FBI and the Department of Homeland Security, have executed a series of search warrants at childcare centers and related businesses in Minneapolis as part of an ongoing fraud probe.
Investigators carried out searches at more than 20 locations in recent days, targeting providers suspected of misusing public funds tied to childcare, Medicaid, and other assistance programs.
The raids are part of a broader crackdown that has already led to dozens of criminal charges and convictions in cases involving fraudulent claims for government-funded services, including pandemic-era programs.
Authorities have said the investigation remains ongoing and involves multiple federal agencies working alongside state and local law enforcement.
Swanson told lawmakers that fraud schemes in Minnesota's childcare system were widely known beyond the U.S.
"They had heard you could run the scam in a number of different states, but it was easiest and you could make the most money doing it in Minnesota," he said.
The allegations have intensified political scrutiny of Democratic Gov. Tim Walz's administration, particularly from Republican lawmakers who argue that oversight mechanisms were weakened in recent years.
During the hearing, Republican state Rep. Kristin Robbins said internal watchdog functions were curtailed, limiting investigators' authority to pursue fraud cases.
Swanson testified that support for his investigative unit declined over time, eventually leading to its dismantling, which he said hindered efforts to detect and prosecute fraud.
The controversy follows years of mounting concerns about fraud in Minnesota's publicly funded programs, including the "Feeding Our Future" case, in which prosecutors alleged hundreds of millions of dollars were stolen through false claims for meals during the COVID-19 pandemic.
Federal officials have also estimated that billions of dollars may have been improperly claimed across multiple state-administered programs since 2018, underscoring the scale of the issue.
Walz has defended his administration's handling of fraud investigations, emphasizing cooperation with federal authorities and pointing to steps taken to strengthen oversight, including audits and the creation of anti-fraud initiatives.
State officials have said joint investigations between state and federal agencies are critical to holding offenders accountable as the probe continues.
Theodore Bunker ✉
Theodore Bunker, a Newsmax writer, has more than a decade covering news, media, and politics.
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