Gov. Tim Walz of Minnesota on Thursday announced a series of legislative initiatives aimed at preventing fraud in the state’s social services programs after a widespread scandal that drew the attention of the White House.
Mr. Walz detailed the anti-fraud plans a day after the Trump administration said it intended to withhold $259 million in Medicaid funds earmarked for the state, citing evidence that hundreds of millions of dollars have been stolen from welfare programs administered by state agencies.
Mr. Walz, a Democrat in his final year in office, called the White House plan to freeze federal funds an act of political retribution that stood to hurt thousands of vulnerable Minnesotans who relied on the safety net programs.
“No state has experienced this before,” Mr. Walz told reporters on Thursday morning. “How does punishing children and the elderly have anything to do with fighting fraud?”
The proposed legislation put forward by Mr. Walz this week was his latest response to a scandal that became a dominant issue in Minnesota politics over the past year and that the White House has cited for an immigration crackdown it launched in the state in December.
Mr. Walz’s proposals included steps to make detecting fraud easier as well as stiffer penalties for those found guilty of stealing from public programs.
The White House began focusing on Minnesota’s fraud problem late last year in response to news reports and a viral video by a right-wing influencer.
Since 2022, federal prosecutors have charged roughly 100 people with felonies, saying they stole hundreds of millions of dollars from programs meant to feed children during the pandemic, treat minors with autism and assist people at risk of homelessness.
At least 60 people have been convicted and most of the rest are awaiting trial or have fled the country. The vast majority of the defendants are American citizens or legal residents of Somali ancestry.
The Trump administration’s announcement on Wednesday that it would withhold Medicaid funds from Minnesota followed several other recent threats to cut funding for food stamps and a program that helps low-income Minnesotans afford child care.
Several of the state-run programs that have become magnets for thieves are funded by Medicaid.
Mr. Walz’s proposals include efforts to increase the statute of limitations for certain fraud offenses. He also is calling for an expansion of the attorney general’s Medicaid fraud unit and for the establishment of an inspector general’s office with oversight of programs run by all state agencies.
Mr. Walz also proposed permanently shutting down a Medicaid-funded program launched in 2020 to help people find and keep housing. The cost of that program exploded over the years as scores of companies began submitting bogus claims, according to federal prosecutors. Medicaid is jointly funded by the federal and state governments.
Republicans in Minnesota voiced skepticism that Mr. Walz and his fellow Democrats were serious about fighting fraud.
“Democrats in Minnesota are feeling the heat over the fraud they’ve enabled for years, and now they’re trying to do damage control,” Lisa Demuth, the Speaker of the Minnesota House, and Representative Harry Niska, a leader in the Republican caucus, said in a statement.
Minnesota’s State Legislature is narrowly split, and lawmakers from both parties have said they expected this year’s session to be defined by gridlock in a midterm election year. Still, there is general agreement that the state must do more to fight fraud, and the proposal for a new inspector general’s office has broad bipartisan support.
Ernesto Londoño is a Times reporter based in Minnesota, covering news in the Midwest and drug use and counternarcotics policy. He welcomes tips and can be reached at elondono.81 on Signal.
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