BREAKING: Trump admin freezes all childcare payments to Minnesota amid massive fraud scandal

The Department of Health and Human Services has frozen all federal child care payments to the state of Minnesota amid a far-reaching fraud scandal that has unfolded in the state. 

HHS Deputy Secretary Jim O’Neill announced on Tuesday evening that three actions have been taken amid " serious allegations that the state of Minnesota has funneled millions of taxpayer dollars to fraudulent daycares across Minnesota over the past decade."

O’Neill said he has "activated our defend the spend system for all ACF payments. Starting today, all ACF payments across America will require a justification and a receipt or photo evidence before we send money to a state." He said that the HHS has identified individuals featured in independent report Nick Shirley’s recent video, and has demanded that Governor Tim Walz conduct an audit of the centers featured. 

O’Neill also announced that a dedicated fraud hotline and email address have been launched. 

"We have turned off the money spigot and we are finding the fraud," he said.

Alex Adams, Assistant Secretary for the Administration for Children and Families, said his office provides Minnesota with $185 million in childcare funds every year. "That money should be helping 19,000 American children, including toddlers and infants. Any dollar stolen by those fraudsters is stolen from those children." 

He said he had spoken with the Director of the Minnesota Child Care Services Office, and "she could not tell me with confidence whether those allegations of fraud are isolated or whether there is fraud stretching statewide."