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Republican lawmakers call for action on child care fraud

Republican lawmakers, responding to a local media report, accused the Minnesota Dept. of Human Services of not doing enough to stop child care assistance fraud. They also bought into speculation the proceeds may be funneled to terrorists.

ST. PAUL, Minn. -- Republican lawmakers Tuesday pounced on a story from a Twin Cities TV station, a story that suggested child care assistance fraud is rampant in Minnesota's East African immigrant community.

Several of the legislators appeared to accept, as fact, speculation in the TV report that the ill-gotten proceeds are being delivered by commercial airline passengers to Kenya and Somalia, and that some of that is being taken by terrorist groups.

"Millions in government subsidies meant to help low-income families with their child care expenses, are being directed to shady daycare centers who provide little to no care," Rep. Mary Franson, an Alexandria Republican, declared on the House floor.

"As much as $100 million. The bulk of the money is headed overseas. And some, may be used to fund terrorist organizations!"

Franson and other members accused the Dayton Administration of not taking the child care assistance fraud seriously enough. She said the Dept. of Human Services was slow to respond to the problem.

Dayton and Democrats, in response to the report, said any kind of child care assistance fraud is very troubling because it denies that aid to families that really need it, and are waiting in line.

But the fraud issue isn't new, and it's not new in the legislature.

Lawmakers last year approved more investigators to help the Dept. of Human Services detect and stop fraud. Multiple daycare centers in Minneapolis have been raided in recent years, and Hennepin County Attorney Mike Freeman has brought criminal charges against those operations.

"In January of 2017 the third of three guilty pleas came in dealing with this issue, so our law enforcement community is engaged and taking action," Rep. Melissa Hortman, the House Minority Leader, remarked.

Later in the day Sen. Jim Abeler, the chair of the Health and Human Services Committee in the Senate, convened a meeting to hear from those who appeared in the television story.

Acting DHS Commissioner Chuck Johnson said he agency is aggressively pursuing child care fraud and theft-by-swindle cases.

"We’ve closed 13 centers due to fraud, stopped all payments going to those centers," Johnson told the committee. "We have six criminal convictions, five through state court, one through federal court. Ten other cases are pending."

He said law enforcement is always brought in, once assistance fraud is discovered. He said, thus far, none of the cases that have been prosecuted have been linked to terrorism.

"There have been raids, court hearings, very public coverage over some of the successes we’ve had."

He also challenged the figure of $100 million in fraud, used in the report and by Republicans who are repeating the claim. He said, for instance, the largest child care center without any fraud claims bills for $12 million per year.

Johnson also countered the claim that this type of child care fraud originated in Minneapolis, pointing out that it was happening in Wisconsin before it moved to Minnesota.

Abeler's committee also heard from Carolyn Ham, the DHS Inspector General, who monitors these cases.

"I am absolutely committed to fighting fraud, and we are doing that," Ham told the panel.

"I can tell you I have never been told to stand down on a case. I have never had any such instructions."

Ham also pointed out that most Somali-operated child care centers are legitimate operations, providing quality child care.

She said none of the daycare centers that were shut down had earned the State's "Parent Aware" rating for quality.

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