Child care fraud in Minnesota has sparked a heated debate, but the truth behind the headlines is far more nuanced. Let's unravel this complex issue and understand the impact it has on families and day cares.
A viral video, posted by right-wing YouTuber Nick Shirley, claimed to expose widespread fraud in Somali-run day cares. However, this video has been debunked by investigators, yet it has led to significant repercussions. The Trump administration and Republicans in Congress have seized on this, with Vice President JD Vance praising Shirley's 'journalism'.
The fallout has been immense. The Trump administration has frozen child care payments to several Democratic-led states, including Minnesota, and increased reporting requirements for all states. Minnesota's Governor Tim Walz has even suspended his reelection campaign over this issue.
But is the fraud as widespread as portrayed? Let's delve deeper.
Shirley's video shows him visiting day cares, often under false pretenses, and recording his interactions. In some cases, workers became suspicious and refused entry, which Shirley took as proof of fraud. However, this is a complex issue. Most child care centers have locked doors and obscured windows for safety reasons, and children are typically kept in classrooms, out of view. One day care even claimed Shirley arrived with masked men, raising suspicions of immigration enforcement.
Minnesota has had issues with child care fraud in the past. A 2019 state investigation found several million dollars in potential fraud, where centers billed for children they didn't care for. By 2019, at least a dozen Minnesotans and centers had been charged with defrauding the state's child care program.
Since then, Minnesota has taken steps to tighten oversight, including creating the Department of Children, Youth, and Families (DCYF) to handle licensing and auditing. A 2025 federal report found issues with overpayments, but this doesn't necessarily indicate fraud.
National child care experts Elliot Haspel and Danielle Ewen emphasize that these issues are not new, but are being presented as an epidemic.
On a national scale, evidence of large-scale child care fraud is lacking. A 2020 report by the US Government Accountability Office found only seven states with errors in more than 10% of child care fund payments since 2013.
State investigators have conducted unannounced visits to the day cares featured in Shirley's video over the past six months, as part of standard licensing and auditing procedures. Most of these centers had recent unannounced inspections.
Investigators found normal operations and children at all but one center, which hadn't yet opened for the day. Four of the nine facilities are under further investigation, but the state hasn't specified the nature of these investigations.
While some centers had licensing violations related to cleanliness and staff supervision, none were for fraud. One center, Quality Learning Center, featured prominently in the video due to a misspelled sign, closed this week. Another, Mako Childcare Center, has been closed since 2022.
There is a connection to prior fraud investigations for one day care in the video. Fowsiya Hassan, CEO of Minnesota Best Childcare Center, previously owned Sunshine Child Care Center, which was raided in 2022 for overbilling fraud. Hassan sued the state over the raid, claiming disproportionate targeting of Somalis in licensing and fraud investigations.
David Hoch, a lobbyist and former right-wing candidate for Minnesota Attorney General, was Shirley's main source. Hoch has a history of focusing on the Somali community and fraud. In a deleted Instagram account, he posted exclusively about the Somali community, making extreme claims about fraud.
President Donald Trump has also targeted the Somali community, claiming that 'much of the Minnesota Fraud, up to 90%, is caused by people that came into our Country, illegally, from Somalia.'
Since Shirley's video, there have been reports of harassment towards Somali-run day cares and businesses, with people demanding to see children or making threatening calls. At least one center was broken into.
The Trump administration's funding freeze has impacted five Democratic-run states, including Minnesota. State officials must provide additional documentation, including Social Security numbers for all 23,000 children receiving child care funds.
The freeze has caused uncertainty for providers and families, as it could lead to staff cuts, classroom closures, or even the closure of day cares. This could disproportionately affect families with limited resources and single mothers.
National child care experts are confused about the exact data the federal government requires and whether states have this data.
The freeze will only be lifted when states prove funds are being spent legitimately. In the meantime, the impact on families and day cares remains a concern.
