Exclusive | Trump freezes $10B in funding to five blue states for child care, social services over fraud fears
Category: News & Politics
Via: john-russell • 10 months ago • 19 commentsBy: Josh Christenson (New York Post)
S E E D E D C O N T E N T
By Josh Christenson Published Jan. 5, 2026, 12:53 p.m. ET
WASHINGTON — The Trump administration is cutting off more than $10 billion in social services and child care funding meant for a handful of Democrat-led states over concerns that the benefits were fraudulently funneled to non-citizens, officials told The Post Monday.
The Department of Health and Human Services will freeze taxpayer funding from the Child Care Development Fund (CCDF), the Temporary Assistance for Needy Families (TANF) program, and the Social Services Block Grant program.
4The Trump administration is cutting off more than $10 billion in social services and child care funding meant for a handful of Democrat-led states, officials told The Post Monday. Getty Images4Minnesota has been at the center of allegations that child care programs are perpetrating fraud after a viral video from YouTuber Nick Shirley alleged nearly a dozen day cares had no kids attending. X / Nick Shirley
At least $7.35 billion in TANF money will be prevented from going to California, Colorado, Illinois, Minnesota, and New York.
The CCDF funding block of nearly $2.4 billion affects all those states.
Another $869 million from the Social Services Block Grant coffers is being kept from all five states as well.
The funding pauses were to be announced via letters to each state sent Monday, citing concerns that benefits were fraudulently going to non-US citizens.
The HHS Office of Inspector General found more than six years ago that New York City improperly billed the federal government for more than $24.7 million in child care subsidies.
Sen. Kirsten Gillibrand (D-NY) blasted the Trump administration's decision to pull back funds.
"To use the power of the government to harm the neediest Americans is immoral and indefensible," Gillibrand said in a statement. "This has nothing to do with fraud and everything to do with political retribution that punishes poor children in need of assistance. I demand that President Trump unfreeze this funding and stop this brazen attack on our children."
HHS also previously sent letters in December to Minnesota Gov. Tim Walz and Minneapolis Mayor Jacob Frey asking whether the billions of taxpayer dollars helped unlawfully "fuel illegal and mass migration," The Post first reported.
Those inquiries were followed by probes the Treasury Department and House Oversight Committee also launched into the mounting fraud scandal, which involves several nonprofits linked to the Somali community in the Twin Cities.
Around 130,000 illegal migrants resided in Minnesota as of 2023, an increase of around 40,000 from 2019 and roughly 2% of the state's population, according to the Pew Research Center.
The Somali diaspora population in the state tops 100,000, most of whom live in the Minneapolis-St. Paul area.
Federal prosecutors have already secured dozens of convictions related to $250 million in funds stolen by one of the Somali-linked organizations, Feeding Our Future, which used the ill-gotten gains to purchase luxury cars and real estate holdings.
4HHS also previously sent letters in December to Minnesota Gov. Tim Walz. @Tim_Walz/X4The Department of Health and Human Services will freeze taxpayer funding from the Child Care Development Fund (CCDF), the Temporary Assistance for Needy Families (TANF) program, and the Social Services Block Grant program. AP
First Assistant Minnesota US Attorney Joe Thompson has since alleged, however, that the "magnitude cannot be overstated" and claimed fraudsters skimmed as much as $9 billion.
"What we see in Minnesota is not a handful of bad actors committing crimes. It's staggering, industrial-scale fraud," Thompson told reporters in a Dec. 18 news conference.
YouTuber Nick Shirley ramped up the pressure by visiting around 10 child care centers in the state that took $111 million in taxpayer funds — a little less than half of which appeared to be open, subsequent reporting from the Minnesota Star Tribune confirmed.
Walz acknowledged the concerns about fraud in a press conference Monday at which he also announced the end of his third run for the governor's office.
"We cannot effectively deliver programs and services if we can't earn the public's trust," the Minnesota Democrat said, before taking a shot at Trump and his "allies in Washington."
"We'll win the fight against the fraudsters, but the political gamesmanship we're seeing from Republicans is only making that fight harder," he added.
Trump fired back in a Truth Social post Monday: "Minnesota's Corrupt Governor will possibly leave office before his Term is up but, in any event, will not be running again because he was caught, REDHANDED, along with Ilhan Omar, and others of his Somali friends, stealing Tens of Billions of Taxpayer Dollars."
"I feel certain the facts will come out, and they will reveal a seriously unscrupulous, and rich, group of 'SLIMEBALLS,'" the president also said.
"Governor Walz has destroyed the State of Minnesota, but others, like Governor Gavin Newscum, JB Pritzker, and Kathy Hochul, have done, in my opinion, an even more dishonest and incompetent job. NO ONE IS ABOVE THE LAW!"
A spokesperson for Colorado Gov. Jared Polis said "the state has not been officially notified of any changes to these funding sources," but if accurate, "it would be awful to see the federal government targeting the most needy families and children this way."
A rep for the Gov. Gavin Newsom administration also said California had not gotten guidance on funding changes, but said the state is "committed to safeguarding the integrity of all child care subsidy payments and takes any potential misuse of funds seriously."
Reps for the governors of New York, Illinois and Minnesota did not immediately respond to requests for comment.
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I dont know if irony is the right word, but Donald Trump is someone who was convicted of fraud. He also paid the victims of his Trump University fraud 25 million dollars.
The only thing he knows about fraud is how to commit it.
Trump should have someone write him another book,
The Art of the STEAL, would be appropriate title, cause for that clown to be calling others out for fraud, is the ultimate kettle/pot scenario.
As Trump costs US taxpayers tens of millions of dollars per year to play golf at his Country Clubs while we pay for it all, all while he reaps the profits.
Wouldn't be surprised if the Venezuelan attack wasn't payback for the Big Oil money that help him get elected. Donations for his big beautiful bullship ballroom, are also monies donated from corporations who expect something in return, and Venezuela OIL is quid pro quo for the way Trump does Ho.
What a POS potUS if ever there was...
So fraud only occurs in these states? Or this just more of the pencil dick's assholishness?
on the plus side, POS/POTUS is turning colorado into a potentially lethal state for maga republicans ...
Ah...that's too bad. What will my brothers do? They're all MAGA and live in CO. I hope they don't all want to move to Arkansas. They would hate it here. They're all city boys
are they tan enough that they have to wear "I'm one of the good ones" tee-shirts around racist magatards?
Nah. I get darker than them in the summer
do they live in the same neighborhood as where they all grew up?
I got a kid like that. he's a magnet for latino and asian girls. we change his middle name from john to juan in the summer. my other 2 are pasty white like their mother and turn into lobsters in the summer.
Not quite but they all live within 20 minutes of each other
that area of town has the best mexican restaurants and was my old stomping ground. it was in the golden triangle of places that most influenced my youth, bordered by the norwest drive in, the north drive in, and the north star drive in. all gone now ...
I can't tell you where his parents live. It's near I-25. Federal? Pecos? I don;t pay attention
I already know, you told me before, and where he went to high school ...
Glad you remember
Fraud, as a human activity, goes back to the cave man days. It is probably one of the original sins. Anyone convicted of fraud should get some kind of prison sentence.
Fraud is often the key component of white collar crime. Much of what led to the Great Recession in 2008 had elememts of fraud. The financial geniuses selling the credit default swaps knew they were fraudulent. The banks knew they were fraudulent, but in the end the banks were shored up by the American taxpayer.
Trump threatens some of the biggest blue states because he can , not because it is any way the right thing to do.
This will be another case of the states having to rely on the Supreme Court to do the right thing, which is shaky.
co-pilot
Cost to U.S. Taxpayers
Although no single number captures all taxpayer losses, several sources give insight into the scale:
A. Fraud Against Government Programs
The Anti‑Fraud Coalition highlights that fraud “costs the government, taxpayers, and market participants” billions annually.
False Claims Act recoveries (which represent only a fraction of total fraud) regularly exceed billions per year, indicating the underlying fraud is far larger.
B. Fraud Against U.S. Businesses (Indirect Taxpayer Impact)
Fraud drains U.S. companies of 9.8% of revenue on average, according to TransUnion’s 2025 report.
These losses indirectly affect taxpayers through:
Higher prices
Lower wages
Reduced tax revenue
Increased government spending on enforcement and social programs
C. Insurance Fraud (a major taxpayer burden)
The National Insurance Crime Bureau reports that fraud costs Americans billions of dollars annually and “drains government resources” directly.
There are Republicans in those states. Trump doesn't care who he hurts, if only Republican voters would begin to figure this out.
he has a fetish for morons that tell him how great he is ...