Dr. Oz Says Minnesota Fraud Coverup Reaches ‘Highest Levels’ of State Government

The Trump administration said it would freeze child care funds in Minnesota unless officials there provide more data about the programs.

Dr. Mehmet Oz, the administrator for the Centers for Medicare & Medicaid Services, after an interview with EpochTV’s 'American Thought Leaders' in Washington on Jan. 16, 2026. Madalina Kilroy/The Epoch Times

Dr. Mehmet Oz, the administrator of the Centers for Medicare & Medicaid Services, revealed that health care fraud in Minnesota is more significant than previously known, according to his interview with EpochTV’s “American Thought Leaders,” premiering at 5 p.m. ET on Jan. 17.

After speaking to whistleblowers across the state, Oz said there has been a “cover-up” for years and that it reaches the “highest levels” of state government.

Oz made reference to Somalian Americans and Somalian nationals who have a significant presence in the Minneapolis-Twin Cities area, who have recently been accused by administration officials of engaging in the defrauding of federal government entitlement programs, including Medicaid.

“For example, the Somalian sub-population, who have different cultural mores than the folks who have historically been in Minnesota, might be taking advantage of systems that were built for ‘Minnesota Nice’ people,” Oz said.

“And this is what was told to me by people working in the Department of Health and Human Services there, from folks who are police, law enforcement, they were witnessing it.”

The administration has gained “evidence now that we might be seeing that in other Somalian populations” in the United States, Oz said, adding that “they talk to each other.”

“Once you figure out that no one’s watching the till, you begin to steal money in other areas,” he said. “In any case, we are aggressive on this.”

Providing an example, Oz said that investigators in the Twin Cities discovered a building with “boarded-up windows” that allegedly had “400 businesses running out of there in the last couple of years that had generated about three $80 million in bills” for the federal government and Minnesota.

“And these are all social service businesses. So as you start to probe into how this beehive of corruption arose, the question does come up, you know, who owns the building? Like, how did this even come about? The building owner would not let us go into the building,” he added.

The state has been under the spotlight for years for Medicaid fraud, including a $300 million COVID-19-related fraud case involving the Feeding Our Future nonprofit.

Federal prosecutors said it was the largest COVID-19-related fraud scheme in the United States, and that the defendants exploited a state-run, federally funded program meant to provide food for children.

Since 2022, 57 people have been convicted, either by pleading guilty or by losing at trial. The majority of the defendants who were charged in the case are of Somali origin. Numerous other fraud cases are under investigation, including new allegations involving child care centers.

Aside from the Medicare and Medicaid agencies, the Treasury Department also announced last week that it will investigate financial transactions between Minnesota residents and businesses in Somalia, as the government ramps up an operation targeting illegal immigration in the state.

The Department of Homeland Security, too, has deployed thousands of agents to Minnesota as part of that broader federal effort, although protests have erupted in recent days over the shooting of a protester.

The Trump administration said late last month it would freeze child care funds in Minnesota unless officials there provide more data about the programs, and in a January statement said it would freeze a program that allows states to pay child care providers without attendance requirements.

A video that went viral on social media in December featured influencer Nick Shirley, who alleged significant daycare fraud involving the theft of state government funds. The clip was amplified and referenced by Vice President JD Vance and tech billionaire Elon Musk on X.

Responding to the claims, Minnesota Gov. Tim Walz has been critical of the Trump administration’s efforts in his state while arguing that his office has already taken steps to reduce fraud.

Meanwhile, the ongoing federal operations in Minneapolis are “a direct threat against the people of this state, who dared to vote against him three times, and who continue to stand up for freedom with courage and empathy and profound grace,” Walz said earlier this week.

The Epoch Times contacted the governor’s office for comment on Jan. 16.

Fraud Investigation Expanding

The administration’s ongoing investigations into entitlement fraud are being expanded, namely in California, Oz told “American Thought Leaders.”

“What we’re seeing in Minnesota is the tip of the iceberg, because it is dwarfed by what I saw in California, which is whole-scale cultural malfeasance around health care,” Oz said.

“There is an acceptance that you need to be in the fraud business, especially in Los Angeles, and the magnitude of fraud there, we believe, is approximating $4 billion just in hospice and home health care.”

Oz described Southern California’s situation as a pervasive “tolerance and acceptance of fraud” and that “it’s so rampant that you don’t even know how to get your arms around it.”

“We have the unions being involved in some of these endeavors and lobbying as well” to get certain individuals elected, he added.

U.S. Attorney's Office officials speak at a news conference inside the U.S. Courthouse in Minneapolis, detailing fraud in Minnesota, on Dec. 18, 2025. Kerem Yücel/Minnesota Public Radio via AP

Oz said he believed foreign-based gangs were perpetrating fraud in hospice and home health care programs, but he did not provide detailed examples.

The alleged fraud “might be part of a much larger scheme to change how we elect our officials, and that is very chilling for us to think that you might be using social programs designed to help all Americans who are struggling or who have vulnerabilities, using that as a tool to change who gets elected,” he said.

Last week, Oz, along with First Assistant U.S. Attorney Bill Essayli, said at a news conference that federal officials will investigate allegations of fraud involving hospice centers in the state, describing the crimes as pervasive.

Both Oz and Essayli suggested that foreign-based gangs were behind the fraud targeting hospice centers and home health care programs, while Oz elaborated on those claims on Friday by saying that a “Russian Armenian ... mafia” was targeting California’s health care systems.

“These hospice programs are created when the most common reason that you enter it is cancer. But these days, not everyone with cancer dies, but also you put a lot of people with Alzheimer’s, other conditions, in there ... so it became a little harder to police whether people were going into hospice,” he said.

A post from California Gov. Gavin Newsom’s press office account on X on Jan. 6 said that the state had stopped tens of billions of dollars in fraud, specifically unemployment fraud, and also criticized the Trump administration.