State investigators have found no evidence to back up claims made in a media report last year that Minnesota's child care program is being defrauded to the tune of $100 million, and that some of this money was being funneled to terrorist organizations.
The report claimed more than $100 million was being defrauded from the state's Child Care Assistance Program (CCAP) every year, and also suggested that "millions of dollars" were leaving MSP Airport in suitcases every year, some of which was finding its way to members of the Somalia-based terror group, Al Shabaab.
Although it notes that federal law enforcement agencies are concerned that foreign terror organizations are obtaining money from U.S. immigrants and refugees, the auditor's office was "unable to substantiate the allegation" that cash sent and used by terror groups came from Minnesota's child care program.
It also says it could find no evidence for the claim that Minnesota's $254 million CCAP is seeing $100 million-worth of fraud, though it did concede that the levels of fraud within the program is likely higher than the $5-6 million proven by prosecutors.
"We cannot offer a reliable estimate of how much fraud exists in the program," it adds.
Part of the FOX 9 report was based on information provided by former Department of Human Services employee Scott Stillman, who repeated the claim about $100 million fraud rates at a Senate Committee hearing last June.
It came after instances in recent years where child care centers have participated in fraud schemes where they sign up low-income families who qualify for child care assistance funding and don't provide any care for their children, yet still claim the money from the state.
Several fraud investigators at CCAP agreed with Stillman's claim about the rate of fraud, but could not provide evidence to back this up, the report found.
Jay Swanson, the manager of the CCAP Investigations Unit, based his claim of a 50 percent fraud rate on concerns his investigators have about 100 DHS-licensed child care centers.
These concerns don't just concern overbilling, but also child care at a level at standards so low that Swanson called them "fraudulent centers."
"Therefore, in Swanson’s opinion, all of the CCAP money paid to those centers in 2017 –approximately $108 million – should be counted as fraud," the report said.
The investigation also found there was a "serious rift" between these same CCAP fraud investigators and DHS officials including Inspector General Carolyn Ham.
Ham disagrees with the claim of a 50 percent-plus child care fraud rate, as stated earlier, there remains uncertainty within the DHS about how much fraud is actually taking place.
"Stillman’s statements and the FOX 9 stories created a strong and disturbing picture of individuals in Minnesota defrauding the state’s Child Care Assistance Program and sending the money to foreign countries where terrorists have obtained the money to fund their organizations and operations," the report concludes.
"Despite the serious nature of the allegation, neither Stillman nor FOX 9 presented specific evidence to substantiate the allegation."