Walz Responds After FBI Launches Major Fraud Probe In Minnesota

Minnesota Gov. Tim Walz is responding to an FBI raid on the state’s Housing Stabilization Services program, which is intended to help older adults and people with disabilities, including those with substance use disorders and mental illness, secure housing.

Investigators executed search warrants at eight locations tied to five Twin Cities providers accused of fraudulently billing for services they did not deliver.

“If you’re going to commit these crimes in Minnesota, you are going to get caught,” Walz said last month in an interview with WCCO.

The governor and former Democratic vice presidential nominee said new safeguards are in place to detect and prevent Medicaid fraud and pledged continued cooperation with law enforcement to hold “bad actors” accountable.

“You’re always gonna find people trying to cheat the system,” Walz told WCCO. “But I think this legislative session with a, you know, the new IG (Inspector General) that’s over there, the new tools that we have, and just the capacity for us. And I wish we would have got a little more. The one thing I wish we would have got it, there are some AI tools out there that would help us on this.”

Acting U.S. Attorney Joe Thompson said Minnesota faces a serious fraud problem, a concern previously raised by his predecessor, Andrew Luger. He added that the issue signals the need for a broader reckoning in the state.

“Minnesota is a generous state and I think there is a tendency to err on the side of making sure children get food, making sure people have housing stabilization,” Walz explained. “But I’ve told our agencies and things that – we can have best intentions, but there are bad folks that are trying to do this.”

FBI agents executed search warrants at eight locations tied to five Twin Cities providers earlier this week, U.S. Attorney Joe Thompson said. The warrants described the housing program “proved to be extremely vulnerable to fraud.” The targeted sites included locations in St. Paul, Roseville, Blaine, Little Canada, and Woodbury, WCCO reported.

Walz is facing sharp criticism from Republicans following the discovery of more fraud in state programs, adding to the massive Feeding Our Future case and a related investigation at Minnesota autism centers.

Rep. Kristin Robbins (R-Maple Grove), chair of the House Fraud and State Agency Oversight Committee, called the latest case an “enormous failure” by the Walz administration to safeguard taxpayer dollars.

“This follows the same pattern the Fraud Committee has been highlighting for months: Minnesota expands unregulated Medicaid services and fraudsters jump in to exploit lax oversight by DHS to steal millions from taxpayers and the poor,” she said.

Separately, Walz spoke highly of President Donald Trump after a tragic shooting at a Minneapolis Catholic school on Wednesday.

“The community behind us—Annunciation Church and School—committed to academics, service, and Catholic values, filled with the first days of school of beautiful children going to learn those values, share with their teachers and their classmates. And instead of that joy and that curiosity and that learning, they were met with evil and horror and death,” Walz said to begin a press conference following the tragedy that left three people dead — the shooter along with two children — and 17 others wounded.

“Speaking with all the people here and grateful to our federal partners, [U.S.] Senator [Amy] Klobuchar [D-Minn.] speaking early this morning and receiving a call from President Trump, who was with his leadership team of the attorney general and the vice president, expressing their deep condolences amongst the horror that happened and an offer to provide the support to the folks here in Minnesota of what’s needed,” Walz said, offering gratitude to the president.