Last week, U.S. Treasury Secretary Scott Bessent announced a series of measures aimed at addressing large-scale government benefits fraud in Minnesota, with a focus on schemes involving Somali organized crime in Minneapolis. During his visit to the state, Bessent participated in discussions with victims of fraud, engaged with financial institutions, presented the administration’s economic plans for 2026 at the Economic Club of Minnesota, and met with high school students to discuss financial literacy.
Secretary Bessent outlined several steps being taken by the Treasury Department to counteract fraudulent activity. These include issuing notices of investigation to multiple money services businesses operating in Minnesota and implementing a Geographic Targeting Order that mandates enhanced reporting for certain international transactions. This order is intended to support prosecutions and aid in recovering laundered funds. The department also released an alert to financial institutions regarding potential fraud within federal child nutrition programs and provided specialized training for law enforcement on utilizing financial data during investigations.
The Internal Revenue Service has begun audits targeting financial institutions suspected of laundering proceeds from fraudulent activities. Additionally, a new task force has been created to investigate abuses related to pandemic-era tax incentives and misuse of nonprofit status under section 501(c)(3).
In remarks during his visit, Secretary Bessent said: “Under President Trump’s leadership, the entire administration is focused on delivering results for the American people. Our citizens have a right to know that their tax dollars are not being diverted to fund acts of global terror or to fund luxury cars for fraudsters.”
He continued: “It is clear that Governor Walz has been negligent in his fiduciary duties as the chief executive of the state of Minnesota, that this would happen on his watch, and we are actively pursuing all leads to see the level of involvement, whether it’s limited to just negligence and incompetence or is something more than that.”
Addressing efforts to track fraudulent funds abroad, Bessent stated: “…All entities in the administration will be pursuing this so that we can get the biggest recoveries possible and we will see, and we are going to leave no stone unturned, whether it was fraudulent real estate, whether it is money that has been wired overseas, we will be tracking it to the Middle East and East Africa. This is why Treasury is involved. This is what we do. We track, we follow the money, and we intend to follow it. As much as we can prosecute the individuals no matter where they are, whether they are in the Minnesota government or they are sitting in East Africa, we will find them.”
Bessent compared these operations with those used against cartel money laundering: “And we view this crime as very similar to the cartel’s money laundering. Many of the same approaches, many of the same shell companies. So, we will see where it goes out from here. That will be a starting point. And as I said, Minnesota is going to be the protocols, the procedures, and the investigative techniques as well as collaboration with other agencies. Minnesota is going to be genesis for a national rollout.”
During a roundtable discussion with community members and law enforcement officials focused on government benefits fraud response strategies—participants criticized Governor Tim Walz’s handling of these issues.
Secretary Bessent emphasized efforts underway: “Treasury is here today because this is what we do. We follow the money. Earlier this morning I met with financial institutions and made clear we must do more to safeguard our nation and protect our financial system from waste, fraud and abuse…One [other] thing that we are going announce is incentives for whistleblowers. If these fraudsters want turn each other in ,we welcome that .We will be offering cash rewards whistleblowers.”
Jennifer Larson ,founder Holland Center autism services advocate ,added :“Minnesota does not have face choice between tolerating fraud shutting down entire sector .There’s better path .Legitimate providers welcome oversight ,and disgusted allowed happen….A blanket shutdown does not distinguish between fraud fidelity .It punishes innocent while not targeting criminals .Clinics closing .Families losing care .Children autism experiencing service disruptions have lifelong consequences.”
Mark Ross ,president St Paul Police Federation ,said :“Two billion dollars could fund our entire police department next ten years .That’s how much money talking about far .And probably just tip iceberg.”
Sheriff Kyle Burton Mille Lacs County noted :“Once you steal $35 ,000 might well steal $35 million because penalty same .Laws Minnesota just not adequate hold folks accountable.” Journalist Liz Collin commented :“On media issue truly one most cowardly complicit media structures place country would say why fraud never tackled head on.” Rep Lisa Demuth Speaker House thanked federal partners stating :“So your help others administration pervasive fraud flourished state stop now thank partners stepping where Governor Walz Democrats failed.”
At an event hosted by Economic Club Minnesota Secretary Bessent described recent national economic performance highlighting growth indicators such as increased GDP rising investment improving real wages He credited policy changes like working families tax cut full expensing business assets boosting capital expenditures lowering consumer prices
According Bessent :“President Trump incentivized historic investments both American individuals industries through working families tax cut which stimulating long-term investment productive capacity American economy By allowing full expensing factories equipment farm structures bill lowers cost capital makes cheaper build America This spurred capex comeback 12% surge business investment first three quarters 2025 largest non-pandemic increase over decade More investment means more supply more supply means lower prices consumer goods families rely”
He also reiterated commitment addressing state-level failures:“Under Governor Tim Walz billions dollars intended families need housing disabled seniors services children were diverted benefit fraudsters am here week signal U S Treasury unwavering commitment recovering stolen funds prosecuting fraudulent criminals preventing scandals like ever happening again investigating similar schemes state by state ”
Recent reports indicate that the U.S trade deficit has reached its lowest level since 2009. Federal authorities plan further investigations into illicit activities aimed at protecting taxpayers.
