A Minnesota state senator took the national stage Tuesday and delivered a blistering assessment of the state’s handling of taxpayer dollars.
Sen. Mark Koran, R–North Branch, testified before a U.S. Senate Homeland Security & Governmental Affairs subcommittee during a hearing titled “Examining Fraud and Foreign Influence in State and Federal Programs.”
The hearing, chaired by U.S. Sen. Josh Hawley, R-Mo., focused in part on what lawmakers described as widespread fraud in Minnesota’s social welfare programs.
Koran, who has served nine years in the Minnesota Senate and on the Legislative Audit Commission, painted a picture of systemic failure.
“I appreciate the opportunity to share my insight on the fraud as I’ve seen it in my nine years as Minnesota state senator as well as being on the Legislative Audit Commission,” Koran began.
He described the bipartisan commission as responsible for appointing the nonpartisan legislative auditor, whose job is to review programs across state government and flag misuse of taxpayer dollars.
“I can tell you that most of these audits are bad,” Koran said. “One of the most common failures is state agencies not verifying that grant recipients did the work that they were paid to do.”
He cited a January 2026 audit in which, he said, “state employees were backdating and fabricating documents after an audit had started, looking to mislead our auditors.”
“Fraud in Minnesota is pervasive and systemic, from the executive branch through the state agencies,” he said. “Even when the legislature puts safeguards in place, they’re often ignored and there are rarely any real consequences.”
Koran did not mince words when describing the scope of the problem.
“The devastation of this incompetence and complicity totals far more in dollars than the media, Gov. [Tim] Walz, or the Democrats admit in public. It’s not millions, it’s not hundreds of millions, it’s billions of dollars stolen,” he testified.
He placed part of the blame squarely on Gov. Walz and Attorney General Keith Ellison.
“The governor and his administration, including Attorney General Keith Ellison, have overseen the largest expansion and fastest acceleration of fraud this country has ever seen,” Koran said, alleging that warnings from legislators and audits were ignored and whistleblowers retaliated against.
He welcomed federal involvement, telling senators, “Because of the failure of Gov. Walz and Minnesota Democrats to address fraud, we welcome the federal government to step up and uncover the audit and stop the fraud in Minnesota to protect state and federal tax dollars.”
“The fraud crisis is either result of gross incompetence or willful complicity,” Koran said. “Minnesota is ground zero for the fraud epidemic, but we can become the blueprint for how to prevent fraud if the right actions are taken.”
Sen. Moreno calls for more accountability
At one point in the hearing, U.S. Sen. Bernie Moreno, R-Ohio questioned Koran about the need for more accountability and floated the idea of holding Minnesota financially responsible.
“Why wouldn’t we just tell Minnesota, ‘You owe us some money that you did not use the way we asked you to use it?'” Moreno asked.
“That’s our greatest concern,” said Koran.
Moreno continued: “Maybe if the taxpayers of Minnesota felt it, they’d stop electing idiots like the current governor and the current mayor — they would make changes. Right now there’s really no accountability.”
Chairman Hawley asked Koran to quantify the damage.
“Give me your best estimate … how many have rampant fraud?” Hawley asked, referring to Minnesota’s state agencies.
“All of them are wrapped up in some sort,” Koran responded, noting that nonprofits receive funding from many of them.
When pressed for a dollar figure, Koran cited federal investigators’ estimates tied to Medicaid programs.
“I think the conservative number … would be about $9 billion,” he said.
Cash leaving the country
Koran also revisited concerns about money leaving Minnesota through the airport.
He described learning about the “Hawala process of the movement of cash” and testified that in one year, “$100 million went out in cash through the Minneapolis-Saint Paul Airport … in suitcases.”
Koran said he has sought federal data for years to better understand how much money is being transferred overseas.
Back home, Koran said Minnesota Senate Republicans passed bipartisan legislation last year to create an independent Office of the Inspector General to identify, investigate and prosecute fraud.
“This effort was blocked by the Democrats in the House but it remains our top priority as we go into this next session,” he testified.
“It has only been because of the national spotlight that our leaders have begun to admit the fraud problem,” Koran said. “I hope that our leaders will work with the federal government to be able to move forward from this dark stain on our state’s history.”
Other witnesses included Haywood Talcove, CEO of LexisNexis Risk Solutions; Seamus Bruner of the Government Accountability Institute; and Dylan Hedtler-Gaudette of the Project on Government Oversight.
Jenna Gloeb
Jenna Gloeb is an Edward R. Murrow Award-winning journalist, media producer, public speaker, and screenwriter. Most recently, she worked as a reporter and on-air host for CCX Media. Jenna is a Minnesota native and resides in the Twin Cities with her husband, son, daughter, and two dogs.
