In his first and so far only public comments since his departure three weeks ago as the head Federal fraud prosecutor in Minnesota, Joe Thompson cited “systemic” failures that allowed schemes that cost Minnesota tax cost taxpayers hundreds of millions of dollars in a variety of programs aimed at assisting the needy in this state.
He spoke in mid-January to an overflow crowd of about 400 Minnesota expatriates, snowbirds, and their guests, at a breakfast session of the Minnesota Meeting in Naples, Florida, a weekly program held during the winter season for Minnesotans in Southeast Florida. Thompson weighed-in on his experience prosecuting massive high-profile fraud cases in Minnesota, less than a week after he departed from his position as Chief of the Fraud and Corruption section of the Minnesota branch of the Justice Department in Minnesota.
Earlier in the week, Thompson, who had previously served as acting U. S. Attorney here and five of his colleagues resigned and left their jobs reportedly due to dissatisfaction with a directive from the Justice Department to launch an investigation of the wife of Renee Good, the Minneapolis woman who was fatally shot by an ICE officer two weeks ago while she was driving away from a protest demonstration in south Minneapolis.
Shortly after their departure, their boss, Attorney General Pam Bondi lashed out at them and claim “she fired them all” since they “wanted to go on vacation because they did not want to support law enforcement.”
The initial fraud in a series of scams began with the Feeding Our Future, which drained some $200 million Dollars from a federal program used to fund school lunches, after school snacks, and summer nutrition programs for underprivileged students. The system, Thompson explained, was set up by individuals forming limited liability companies (LLC’s) that register with the Secretary of State and then qualified to receive funding for the program, which was laundered through “shell companies” and used for personal expenses for the participants purchasing “luxurious” homes, commercial buildings, cars, recreational facilities, resorts, and other amenities. The program was overseen by a White woman, Amy Bock, but consistent “largely” of Somalians operating “dozens and dozens” of sites in Minneapolis and surrounding the Twin Cities area. The fraud was bolstered after the states tried to cut off some funding, but the organization successfully sued to maintain the payments.
The questionable practices were first uncovered by a federal auditor in the summer of 2021 involving “hundreds of millions of dollars” over about 18-month period during the COVID period. An ending investigation led to criminal charges against 98 individuals. Sixty of them were convicted in a pair of long trials which included bribery charge to pay off a juror. Charges remain pending against others.
But, as Thompson related, the “fraud is more than Feeding Out Future.” A “large number of individuals, primary Somalians,” followed “almost the exact same pattern” in setting up other entities to participate in healthcare companies, child autism programs, daycare centers, home healthcare, and transporting individual for medical appointment. As with the Feeding Our Future arrangement, very little, if any, actual services were provided but some $220 million in Medicaid claims were paid out including about $125 million through a housing stabilization program using Medicaid funds as a means of supposedly improving health condition for the homeless.
These frauds, which were still being investigated and prosecuted by Thompson his team when they when he left, were “striking at the core of our state,” he said. He lamented that the fraud took advantage of the Minnesota model of the “model of relatively high taxes and high services,” but the services provided were minimal or non-existent.
What Thompson termed the “systemic” problems that led to the contributed to the fraud schemes included. the Minnesota inclination to provide assistance to the needy, coupled with an insufficient resource to investigating combat fraud, which “eclipse” available resources. Thompson also stated that the perpetrators benefited from “weaponization of claims of racism,” pushing back against the charges by claiming that they were victims of racism and ethnicity since about 90% of them were Somalians. He also pointed to the “clash of cultures” existing between the Somali community and American principles as a contributing factor to the fraudulent undertakings.
“Everybody needs to do better about taking fraud more seriously and using more effort to curb it,” Thompson added.
Thompson demurred regarding his future, other than stating that “time will tell,” but that he “hopes to continue to be involved in the fraud work.” He said that there is a need to have a “completely different “mindset” in order to call grapple with these issues in “a responsible way.”
