In reaction to the massive amount of fraud involving child daycare facilities in Minnesota, the U.S. Department of Health and Human Services announced Tuesday evening that all childcare payments to the state are now FROZEN.
HHS Deputy Secretary Jim O’Neill announced the crackdown in a post on X.
O’Neill wrote:
We have frozen all child care payments to the state of Minnesota.
You have probably read the serious allegations that the state of Minnesota has funneled millions of taxpayer dollars to fraudulent daycares across Minnesota over the past decade.
Today we have taken three actions against the blatant fraud that appears to be rampant in Minnesota and across the country:
1. I have activated our defend the spend system for all ACF payments. Starting today, all ACF payments across America will require a justification and a receipt or photo evidence before we send money to a state.
2. Alex Adams and I have identified the individuals in @nickshirleyy’s excellent work. I have demanded from @GovTimWalz a comprehensive audit of these centers. This includes attendance records, licenses, complaints, investigations, and inspections.
3. We have launched a dedicated fraud-reporting hotline and email address at https://childcare.gov Whether you are a parent, provider, or member of the general public, we want to hear from you.
We have turned off the money spigot and we are finding the fraud.
WATCH the video message below:
We have frozen all child care payments to the state of Minnesota.
You have probably read the serious allegations that the state of Minnesota has funneled millions of taxpayer dollars to fraudulent daycares across Minnesota over the past decade.
Today we have taken three actions… pic.twitter.com/VYbyf3WGop
— Deputy Secretary Jim O’Neill (@HHS_Jim) December 30, 2025
NEWS ALERT: Feds launch ‘massive operation’ in Minnesota amid fraud scandal
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