Federal Freeze Follows Revelations That Somali-Run Daycares in Minnesota Failed to Provide Required Documentation
A viral video posted by conservative content creator Nick Shirley has ignited a major federal investigation into Somali-operated child care centers in Minnesota. The situation paints a troubling picture: none of the centers required to authenticate their operations have complied with federal documentation standards. The U.S. Department of Health and Human Services (HHS) confirmed that no qualifying evidence has been submitted by those under review.
The fallout has been significant. As Shirley noted in his December 26 post, “after the government required Minnesota Somali daycares to PROVE they are legitimate and using the funds properly, not a SINGLE ONE has been able to do so.” In immediate response, HHS froze nearly $185 million in federal child care funding allocated to Minnesota—impacting about 19,000 children reliant on subsidized care.
Federal officials state that this funding will only resume when the state verifies that taxpayer dollars are being used properly. HHS Deputy Secretary Jim O’Neill emphasized, “Funds will be released only when states prove they are being spent legitimately.” HHS spokesperson Andrew Nixon reinforced this message, declaring, “The onus is on the state to provide additional verification.”
This controversy erupted after Shirley’s extensive video showcased what he described as numerous Somali-run child care centers shuttered during daylight hours, devoid of any children. The video quickly garnered tens of millions of views and was shared widely by influential figures, including the Vice President and a prominent entrepreneur. Days later, HHS halted funding, prompting multiple federal agencies, including the FBI and Department of Homeland Security, to launch investigations.
Minnesota officials seemed unprepared for the backlash. The state’s Department of Children, Youth, and Families (DCYF) promptly sent inspectors for unannounced visits to some centers. While these inspections reportedly confirmed the presence of children at most sites, the critical issue persisted: none of the centers were able to produce adequate financial and operational documentation to satisfy federal compliance checks by the January 9 deadline.
As House Oversight Chair Rep. James Comer put it, “We’re not talking about minor paperwork errors… We’re talking about a systemic failure to demonstrate the very basics of operational legitimacy. Governor Tim Walz and Attorney General Keith Ellison have either been asleep at the wheel or complicit in a massive fraud.”
This is not the first occasion that Minnesota’s social service programs have been scrutinized. Fraud has plagued various state-supported programs, leading to 92 federal indictments and 62 convictions since 2021. Among those convicted were individuals associated with the Feeding Our Future nonprofit, which has been identified as central to what FBI Director Kash Patel called “the largest pandemic-era fraud in the United States.”
In this latest investigation, the daycare centers in focus were meant to provide subsidized care for low-income families. However, federal investigators noted failures to produce crucial documents like payroll records, attendance data, compliance with safety standards, and proper licensing. Questions surrounding property records and complex business layers only further clouded the verification process.
As of early January, not a single Somali-operated center under investigation had fulfilled federal audit requirements. In light of the situation, ICE officers and agents from Homeland Security Investigations started door-to-door verifications. Local FBI units added resources to manage document reviews and fraud analysis.
Despite no arrests being reported, concerning patterns have surfaced. Investigators discovered indications of overstated attendance figures, unqualified staff listings, excessive federal reimbursements, and instances where facilities claimed full federal subsidies while remaining locked up.
Shirley’s recordings depicted multiple locations that appeared deserted in the midst of a weekday. Some owners refused to engage, while others would not allow entry even when asked to verify their operations. Experts contend that refusal to answer the door does not equate to guilt; however, the ongoing inability to provide documentation raises valid concerns.
Governor Tim Walz publicly addressed the issue on January 8, just before a crucial federal deadline. “We’ve spent years cracking down on fraud… I am accountable for this, and more importantly, I am the one that will fix it,” Walz said. However, he later disclosed that he would not pursue reelection in 2024, citing the growing political crisis as a “distraction to effective governance.”
For families in Minnesota, the funding freeze brings immediate repercussions. Approximately 19,000 children depend on subsidized child care through the federal funds now temporarily withheld. The uncertainty leaves providers anxious about payroll, while parents scramble for alternatives. “It’s just random calls, extra things that we don’t need to focus on,” said Kassim Busuri, who operates a daycare under scrutiny. “We need to focus on our children that we care for.”
The national implications may extend even further. Rep. Comer’s Oversight Committee plans to convene on January 10 for testimony from Minnesota legislators. A second hearing with Governor Walz and Attorney General Ellison is scheduled for February 10. The discussions could significantly influence funding mechanisms for federal child support programs beyond Minnesota.
Meanwhile, the Somali-American community in Minnesota fears heightened scrutiny. The Council on American-Islamic Relations (CAIR) has cautioned against a resurgence of anti-Somali and anti-immigrant sentiment, noting reports of vandalism and harassment at several centers since the video’s publication.
Still, federal investigators assert that preventing fraud must remain a priority. “Fraud that steals from taxpayers and robs vulnerable children will remain a top priority,” FBI Director Patel confirmed. “This isn’t about one group or one video. It’s about ensuring federal dollars serve the public, not criminals.”
As investigations progress, one undeniable fact stands out: every Somali-operated daycare required to submit documentation has failed to do so. Highlighted by Shirley’s viral exposé, this situation sits at the heart of one of the most explosive federal fraud investigations in recent history. Whether it will lead to systemic reform or increased political division remains to be seen.
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