Somali terror group al-Shabab ‘taking a cut’ of millions in stolen Minnesota taxpayer money from welfare fraud scheme: report

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• Somali terror group al-Shabab ‘taking a cut’ of millions in stolen Minnesota taxpayer money from welfare fraud scheme: report

By 

Victor Nava

Published Nov. 20, 2025, 10:39 p.m. ET

 

Millions of dollars in taxpayer money stolen as part of a series of massive Minnesota welfare fraud schemes may have been funneled to Somalia-based terror group al-Shabab, according to a report. 

The radical Islamic terror group, which is a longstanding ally of al Qaeda and considered a threat to US interests, has likely been the beneficiary of money stolen in a spate of scams and sent to Somalia by the criminals defrauding the North Star State, City Journal reported Wednesday, citing federal counterterrorism sources. 

“This is a third-rail conversation, but the largest funder of al-Shabab is the Minnesota taxpayer,” a source who worked on a federal investigation into Minnesotans attempting to join overseas terror groups, told the outlet. 

“There is an issue here that is real, and if there is ever an event that is traceable back to these funds, or to people from this area, then this situation will take on a whole new set of optics,” the source warned. 

The terror group reportedly takes a cut of money fraudulently obtained in the US and smuggled to Somalia.AFP via Getty Images

 

Minnesota has been plagued by several high-profile fraud scandals in recent years, the largest being the Feeding Our Future scheme, for which prosecutors have racked up 56 criminal convictions in what they allege was a plot to steal $300 million from a federally funded program meant to feed children during the coronavirus pandemic. In recent months, the Minnesota US Attorney’s Office has uncovered multimillion-dollar fraud schemes targeting the state’s Medicaid Housing Stabilization Services program and a federally funded autism services for children program. 

The state’s top prosecutor believes “billions of dollars in taxpayer money” has been stolen as a result of fraud. 

“To be clear, this is not an isolated scheme,” acting US Attorney Joseph Thompson said in September when announcing the first charges in the autism fraud scheme. “From Feeding Our Future to Housing Stabilization Services and now Autism Services, these massive fraud schemes form a web that has stolen billions of dollars in taxpayer money.  

“Each case we bring exposes another strand of this network. The challenge is immense, but our work continues.”

Former fraud investigator Kayesh Magan, a Somali-American who had worked in the Minnesota Attorney General’s Office, noted in an op-ed last year that it is “uncomfortable and true” that “nearly all of the defendants” in several Minnesota fraud cases, including Feeding Our Future, “are from my community. The Somali community.”

David Gaither, a former Republican Minnesota state senator, believes state Democrats and the media have ignored fraud being perpetrated by members of the state’s large and politically influential Somali community, which has made the problem worse. 

“The media does not want to put a light on this,” Gaither told City Journal. “And if you’re a politician, it’s a significant disadvantage for you to alienate the Somali community. If you don’t win the Somali community, you can’t win Minneapolis. And if you don’t win Minneapolis, you can’t win the state. End of story.”

 

[phkrause]

Half of $18B in federal funds for Minnesota-run programs may have been defrauded, official says

MINNEAPOLIS (AP) — Half or more of the roughly $18 billion in federal funds that supported 14 Minnesota-run programs since 2018 may have been stolen, a federal prosecutor said Thursday, describing the massive and multilayered fraud schemes as staggering.

https://apnews.com/article/minnesota-fraud-charges-fbad68312012dc02a4060852474f72ee?

[phkrause]

Walz’s rough day ends a rough year

Gov. Tim Walz had the best 15 months of any politician in America between May of 2023, when the Democratic-trifecta delivered on a long wish list of progressive legislation, to his selection as Democratic vice presidential nominee in the summer of 2024.

https://www.newsfromthestates.com/article/walzs-rough-day-ends-rough-year?

[phkrause]

Right-Wing YouTuber Behind Viral Minnesota Fraud Video Has Long Anti-Immigrant History

The day after Christmas, far-right YouTuber Nick Shirley posted a video claiming to have exposed fraud at Somali-owned day care centers in Minnesota. Portions of the 42-minute video — mostly scenes where Shirley is turned away at the day cares — went viral in conservative circles, catching the attention of the Trump administration, which was already at work targeting Minnesota’s Somali community amid its broader war on immigrants.

https://theintercept.com/2025/12/31/nick-shirley-videos-minnesota-somali-day-cares-fraud-claims/?

[phkrause]

Unpacking claim Trump pardoned man who stole more than alleged Somali fraudsters in Minnesota

As Minnesota Democrats stood accused of allowing massive fraud, critics of the president said he pardoned a fraudster who stole far more.

Claim:

U.S. President Donald Trump pardoned a swindler who was serving a sentence for stealing far more money than was taken in massive welfare fraud in Minnesota involving members of the state's Somali community.

Rating:

Mixture

What's False

Trump did not pardon the swindler in question, Philip Esformes. In 2020, Trump commuted his 20-year sentence to time served. Esformes remained liable for $44.2 million in restitution and forfeiture.

What's Undetermined

Esformes was convicted of stealing $1.3 billion from Medicaid and Medicare. The total amount stolen in Minnesota has yet to be determined. First Assistant U.S. Attorney Joseph H. Thompson said fraudsters may have stolen as much as $9 billion since 2018 from various welfare benefit programs. A Minnesota Star Tribune calculation in early December 2025 found $217.7 million in stolen money, which the government disputed.

https://www.snopes.com/fact-check/trump-pardon-fraud-minnesota-somali/?

[phkrause]

Unnamed Source in Viral Minnesota Somali Fraud Video Is Right-Wing Lobbyist Who Called Muslims “Demons”

In his video alleging fraud at Somali-owned day care centers in Minneapolis, right-wing YouTuber Nick Shirley was led around the city by a purported whistleblower called only “David.” Shirley — and outlets like Fox News that credulously picked up the influencer’s video — credited “David” by first name only.

https://theintercept.com/2026/01/03/minnesota-fraud-video-somalis-nick-shirley-source/?