Minnesota citizens have every right to feel angry and betrayed over the conclusion of two recent Office of the Legislative Auditor (OLA) reports. The amount of fraud reported is significant and breathtaking. It is also shocking to realize how many citizens are willing and able to steal from government programs. We can have a robust discussion over policy and spending of taxpayer dollars, but we must all coalesce around the accountable allocation of those funds.
For quite some time we have heard about the Feeding Our Future (FF) program and the theft of $250 million with 70 defendants now charged in federal court. As that process works its way through the system, I believe it is necessary for the reader to understand something of the disbursement of funds and to what level the fraud reached.
Let’s back up and establish some background. Under federal law, the Minnesota Department of Education (MDE) was responsible for administering two food programs — Child & Adult Care Food Program (CACFP) and Summer Food Service Program (SFSP). Sponsors for these programs were school districts, child care programs and nonprofits — of which Feeding Our Future (FF) participated. In my review of the 105 page Office of Legislative Auditor (OLA) report, there were many glaring mistakes that were ignored and overlooked by the MDE. As a former law enforcement investigator, the “bread crumbs” for this massive fraud were the size of dinner rolls. Anyone with a rudimentary level of accounting and curiosity would have uncovered this early on.
During the course of the program, FF began increasing their “managed sites” astronomically over all other sponsors. As Covid continued, MDE gave approval to increase their site locations. As page 16 in the OLA report shows, (Exhibit 2.3), FF sponsored site claims rose exponentially over all other sponsors. For example, the average number of sites for other sponsors were 12 (2019), 18 (2020) and 19 (2021). But FF claimed 116, 384 and 312 for the same respective years.
Obviously their reimbursements went up dramatically too. At their peak, in April 2021, (Exhibit 2.1 on page 14), FF claimed 11.8 million meals and snacks were served. MDE paid out almost $32 million — for one month! That was an eye-popping 7,104% increase in claims over April 2020 and 87 times the reimbursement! For perspective, keep in mind the population of Minnesota is 5.7 million. Yet no alarm bells or red flags sounded or flashed. While some 30 complaints were made concerning FF procedures, between 2018 and 2021, OLA found investigations were incomplete and had “limited usefulness.” Anything hinting of fraud was largely ignored at that time. MDE even asked FF to investigate their own complaints (summary pg. 2). One could conclude that MDE really never cared to administer the funds with accountability.
While shell corporations were being created and wire fraud was rampant, FF even demanded kickbacks from local vendors. If they failed to pay, FF cancelled their contract and paid them nothing. If the MDE did their job, they could have declared FF “seriously deficient” and cut all funding. Twice, MDE found FF negligent in providing a timely financial audit and demonstrating internal controls — but elected to defer any real judgement. The fraud continued unabated.
The OLA findings did not mince any words. In summation, they said MDE: did not heed the numerous warning signs, did not exercise their authority to hold FF accountable and was ill-prepared to address issues encountered with FF. In other words, a complete abdication of responsibility.
Remarkably, the new commissioner of Education, Willie L. Jett II, pushed back in a June 7, 2024 letter stating, “MDE disputes the OLA’s characterization regarding the adequacy of MDE’s oversight — MDE’s oversight of these programs met applicable standards and MDE made effective referrals to law enforcement.” In my opinion, Mr. Jett is not signaling that he is going to hold MDE staff accountable but instead is “circling the wagons.”
Gov. Tim Walz offered a weak admonishment of his state education agency, claiming there was no malfeasance but a lack of due diligence. Yet one might ask, how does he know this when money meant to feed children flowed into personal enrichment here and abroad so easily? The governor called for more verification to “high risk applicants.” How will that be accepted by certain ethnic communities? Claiming “we can do better,” he created an inspector general position to assist MDE. But that too may be a mistake as how vigilant will an “inspector” be when overseeing the agency they work within?
In a remarkable continuation of the story, five defendants have been charged by U.S. Attorney Andrew Luger for attempting to bribe a juror with a bag of $120,000. Two of the defendants were already convicted in the original case! In an elaborate scheme, a jury member identified as “Juror 52” was tracked and targeted to be the insider to convince other jurors to acquit the defendants largely based on racial bias. The federal complaint reads like a gangster movie script.
In a companion report, the OLA examined the efficiency of the “frontline worker program” meant as a reward for those who worked in high risk assignments during the Covid epidemic. About 667,000 recipients were identified. However, 1.2 million recipients applied and claimed to be eligible. The OLA concluded about 60% were actually eligible! The recognition payment was set at $750 with $500 million allocated by the legislature. That payment dwindled to $487 each as all applicants were paid. Remarkably, 290 of the named recipients were actually dead! Will there be a criminal investigation here by Attorney General Keith Ellison?
Minnesota taxpayers must demand that resources are spent with much tighter controls and greater scrutiny. The cavalier attitude that seems all too pervasive must end immediately as this national embarrassment continues to unfold.
Joe Polunc
Joe Polunc is a retired Carver County Deputy Sheriff.
