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Minnesota governor pushes back against food fraud criticism

ST. PAUL, Minn. (AP) Democratic Gov. Tim Walz pushed back Thursday against critics who say his administration must have done more to thwart what federal prosecutors have called a scheme to make use of the COVID-19 pandemic to defraud the U.S. government of at the very least $250 million.

Walz said the Minnesota Department of Educations hands were tied by way of a court order for this to resume food program payments despite concerns hawaii had raised. And he said the FBI asked hawaii to keep the reimbursements while its investigation continued.

Federal authorities on Tuesday announced charges against 48 people in Minnesota on conspiracy along with other counts in what they said was the largest pandemic-related fraud scheme yet. Most of the companies that claimed to be serving food to low-income children were sponsored by way of a nonprofit called Feeding Our Future.

The defendants allegedly created companies that claimed to be offering meals to thousands of children across Minnesota, then sought reimbursement through Feeding our Future from the U.S. Department of Agricultures child nutrition programs. But prosecutors said few meals were actually served, and the defendants spent the amount of money on luxury cars, property and jewelry. The federal government has up to now recovered $50 million.

We caught this fraud. We caught it very early. We alerted the proper people, Walz said at a news conference in his first detailed public remarks on the case. We were taken up to court. We were sued. We were threatened with likely to jail. We stuck with it.

The governor said his administration spotted irregularities very early and alerted the USDA during President Donald Trumps administration. Walz said he couldnt recall precisely when he first learned of the suspicions.

Court filings indicate Feeding Our Future put on turn into a program sponsor in Spring 2020, and that hawaii agency began attempting to crack down in October 2020.

Walz said there must be overview of why the USDA didnt take the states concerns seriously when it first sounded the alarm. Hawaii agency contends its concerns werent taken seriously until it reached out to the FBI in April of 2021. The FBI ultimately executed a number of search warrants in January 2022 and released partial information regarding the investigation, effectively shutting down the alleged scheme.

Walz also noted that Ramsey County District Judge John Guthmann ordered hawaii in April 2021 to resume the payments and and held hawaii agency in contempt of court. Walz suggested the judges order was expensive.

The majority of the money left directly after we were forced to keep to cover, not before, he said.

It had been only under President Joe Biden that the FBI begun to act, Walz said. But he said Education Commissioner Heather Mueller came under FBI orders not saying whatever could jeopardize the investigation.

I and my team haven’t been able to state anything as the FBI was within an active investigation and we were told never to, he said.

Walz also said he’d prefer to see a study in to the judges order to resume payments, though he didnt say who should conduct that inquiry. The judiciary is independent beneath the constitutional separation of powers.

I was speechless, the governor said. Unbelievable that ruling would drop, didn’t really know very well what to state. Obviously we’d to honor it. … I wouldnt have believed in a million years they were likely to rule this way.

Republicans were quick to denounce the Walz administration for not doing more and earlier to avoid the scheme, and for not appealing the judges order to resume payments. They will have also tried to spread blame to Attorney General Keith Ellison and State Auditor Julie Blaha, despite the fact that their authority to monitor Feeding Our Future appeared minimal at best.

This is actually the largest case of COVID fraud in the country because MDE didnt do their jobs, Minnesota Senate Education Committee Chairman Roger Chamberlain said in a statement Tuesday. The fraud was started and persisted because MDE didn’t complete homework on these bad actors. They could have assisted in the investigation, but its inadequate, too late.

GOP gubernatorial candidate Scott Jensen called on Walz to require Muellers resignation.

Bur Walz said the GOP criticism is unwarranted and defended his commissioner.

Its amazing if you ask me that people find folks in the political realm which are more angry they cant blame us for everything instead of recognizing we’d criminals that people caught, the governor said.

When he announced the indictments Tuesday, U.S. Attorney Andy Luger said it took his office and the FBI, working at breakneck speed, until January 2022 in order to shut the scheme down. Asked if the Minnesota Department of Education did anything wrong in its handling of the problem, Luger replied, Thats not for me personally to state.

But Luger added: Were happy with the cooperation thorough cooperation we got from MDE throughout this investigation. … I blame the defendants who perpetrated, covered up and executed the scheme.

Hawaii on Wednesday asked another judge, who’s overseeing the dissolution of Feeding our Future, to order the group to reimburse it for the over $580,000 it paid to guard itself against what it called a sham lawsuit.

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